加载中...
共找到 4,208 条相关资讯
OpenAI's recent funding deal and stunning valuation helped lift U.S. stocks to another record closing high. OpenAI's latest investment round valued the privately held AI company at about $500 billion, and two tech heavyweights, Samsung Electronics and SK Hynix, signed on as memory-chip partners for its “Stargate” infrastructure project. Semiconductor stocks rose, and investors looked past the potential fallout from a government shutdown that is expected to stretch into next week.
Jeremy Siegel, Wharton School professor of Finance and WisdomTree chief economist, joins 'Closing Bell Overtime' to discuss the resilience of the stock market rally, the impact of the government shutdown, and what consumer sentiment signals mean for investors.
Meghan Shue, Wilmington Trust, joins 'Closing Bell' to discuss the latest market action.
Crucial reports on U.S. inflation, job creation and unemployment are set to be delayed a week or more due to the government shutdown — and there's even a danger that some inflation reports might not be produced at all.
According to one report, each week of shutdown could cost up to $7bn, with another suggesting a $15bn loss in GDP
Alex Ng: Good afternoon, and welcome to Stolt-Nielsen's Earnings Call for the Third Quarter of 2025. As always, the earnings release and related materials are available on our website. We will also be recording the session, and playback will be available on the website from tomorrow. Included in this presentation are various forward-looking statements. Such forward-looking statements are subject to risks and uncertainties, and we refer you to our latest annual report for such details. I'm Alex Ng, Vice President of Corporate Development and Strategy. Joining me today are Udo Lange, CEO; and Jens Gruner-Hegge, our CFO. At the end of the presentation, there will be a Q&A session where we will be taking questions from online. [Operator Instructions] Thank you, and over to you, Udo. Udo Lange: Thanks, Alex. Welcome, everyone, and thanks for joining us today for our third quarter results. The presentation will follow the usual format. I will begin with an overview of the Group's results for the quarter and share key highlights. Then Jens will cover the financials, before handing back to me to run through the performance of our divisions, our view of the market outlook and a few concluding remarks. Despite a challenging macro backdrop of ongoing global trade and geopolitical uncertainty, our businesses enjoyed a resilient performance, delivering a quarterly EBITDA of over $190 million and a last 12 months EBITDA above $800 million for the sixth quarter in a row. The company has delivered consistent performance again this quarter. This has been achieved through the dedication, professionalism and spirit of our 7,000 people around the world working tirelessly in pursuit of being simply the best for our shareholders, customers and people. Our portfolio also builds in resilience to market fluctuation with 45% of our EBITDA this quarter achieved outside of Stolt Tankers. While Stolt Tankers' EBITDA fell 27% from the same quarter last year, the other areas of our operations delivered an increase in EBITDA of 13%, diluting the impact of softer shipping markets. These results demonstrate that the company is a liquid logistics solutions provider and show the impact of our diversified portfolio. Last week saw the annual EPCA conference in Berlin. That's the European Petrochemical Association event that brings together some of our largest global petrochemical customers. We met many of our customers and heard from them the challenges they are facing as they navigate the current uncertain market conditions. We also heard directly how our suite of liquid logistics solutions across the supply chain is more relevant than ever. Our value proposition delivering quality, reliability and flexibility is meeting our customers' needs and has supported another resilient quarterly performance. I want to reiterate the message we first communicated at our Capital Markets Day last year. We are not a shipping business, but a logistics business. To help our investors and analysts, we have focused our commentary on our liquid logistics operations, which contribute nearly 90% of our EBITDA. And so you will notice that we have scaled back our commentary on Stolt Sea Farm and Gas operations. You may also remember that at the time of our Q2 report in July, we evolved how we communicate our earnings potential, aligning our guidance approach with our business model by providing EBITDA guidance for the full year 2025. Today we have refined our range, with 2025 EBITDA now expected to be in a range of $750 million to $700 million (sic) [ $790 million ]. Of course, this range is based on what we know today, assumes no substantial geopolitical changes and is subject to a number of uncertainties in the current operating environment. As always, we continue to maintain a conservative balance sheet benefiting from robust liquidity and well-spread debt maturities. Let's now turn the page to review our financial highlights. I've already said we have delivered another consistent result despite a challenging operating environment. Moving along the top row. Operating revenue was down nearly 5% or $33 million, predominantly driven by weaker freight rates and Stolt Tankers. EBITDA before the fair value adjustment was $192 million, down $23.5 million on the record levels from last year. Operating profit was down year-over-year by $30 million, partly due to the additional depreciation applicable to the HS4 ships and Avenir. Net profit was also down, driven by the same factors, as well as higher interest expenses due to the consolidation of acquisition debt. Free cash flow was down $77 million year-over-year, driven by higher CapEx, including the NST newbuilding deposits, higher interest expense and sale of 2 vessels in the third quarter last year. Net debt-to-EBITDA has increased to 2.94x as a result of an increase in consolidated debt from HS4 and Avenir. Over the page, we look at some of the key drivers of performance. Looking at our performance metrics. Average deepsea TCE revenue per operating day for the quarter was just under $25,000, down versus last quarter. This is due -- down versus last year's record highs. This is due to softer sentiment impacting freight rates, particularly in the spot market. However, TCE for the quarter remains at an attractive level versus the long-term cycle average. Utilization remains on an upward trajectory at Stolthaven Terminals at almost 92%. We expect utilization to be stable over the coming quarters going into 2026. Gross profit per shipment declined 5% at STC, predominantly driven by lower ocean freight rates and the wait-and-see mode of customers in this complex supply chain environment. Our portfolio continues to demonstrate resilience to market fluctuations as around 45% of EBITDA achieved outside Stolt Tankers is nontanker operations producing a 13% EBITDA growth year-over-year. That's all from me now. Jens, over to you for the financials. Jens Grüner-Hegge: Thank you, Udo. Good afternoon, everyone, and good morning to those of you joining us from the United States. I will compare the third quarter of 2025 against the third quarter of 2024. And just to remind you, our third quarter runs from June 1 through August 31. And to reiterate what Udo talked about, the company's performance is resilient, and with the growth in EBITDA contributions from the nontanker segments, we're able to maintain a strong EBITDA at $192 million for the quarter before the fair value adjustment of biomass. If we move to the next, let's dive into the numbers for this quarter. So the drop in revenue was predominantly driven by tankers reflecting the lower spot rates. This was partly offset by a 6.6% increase in volume following additions to the fleet over the last 12 months. STC's revenue was marginally down, but offset by an equal increase in Stolthaven Terminals. Operating expenses were down in line with the reduction in revenue, but also due to the acquisition of 100% of Hassel Shipping 4, resulting in the business no longer being accounted for as a JV but being fully consolidated. And this caused the decrease in the TC expense or the pullout expense, and that was partly offset by an increase in owning expenses which forms a big part of their operating expense. Depreciation expense was also up as a consequence of the consolidation of Avenir and Hassel Shipping 4 as well as due to the capitalization of additional time-charter ships as per IFRS 16. And the equity income from joint ventures was down, driven by the same consolidation of the joint ventures. So A&G expense was up compared to last year, mostly reflecting annual inflation adjustments as well as a consequence of the weaker U.S. dollar, partly offset by lower profit sharing accruals related to lower net income. Operating profit for the quarter was $109.4 million, that's down from the $139.3 million, as Udo mentioned. But that was a record quarter last year. And that's driven predominantly by the weaker tanker results. And net interest expense was up $4.9 million due to an increase in net debt following the 2 acquisitions and other capital expenditures. FX gains on hedges were up, also driven by the weakening of the U.S. dollar. And income tax was up, reflecting the improved earnings in the nontanker businesses. And consequently, net profit for the quarter ended up at $64 million, with EBITDA of $191.7 million, and this is down from the same period last year and slightly weaker than the previous quarter this year. So if we move over to the next, we can have a look at the cash flow. So cash from operations was strong this last quarter, almost as high as the peak third quarter of last year. Net cash was down due to an increase in interest payments during the quarter. And note that the cash interest payments differ from the interest expense shown on the previous slide due to the timing of payments, with the first and third quarters normally having higher payments. Cash spent on capital expenditures was substantially up, reflecting in part increased progress payments on newbuildings and terminal CapEx as well as a reduction in gain on sale of assets as we sold 2 ships in the third quarter of last year. And then during the quarter, we also repaid a net $59.6 million of debt and capital leases. FX had a minor positive impact on our cash balance as we consequently ended up with an increase in cash from prior quarter of $30.8 million, but a decrease compared to the same quarter last year of about $170 million when we sat on cash in order to effect the acquisition of 100% of Hassel Shipping 4. Also last year, we had just completed the U.S. private placement of $450 million that was concluded during the same quarter last year. At the bottom right, you see our total liquidity position, which at the end of the third quarter was at $466 million, and that's also slightly up from the last quarter. So let's have a look at the capital expenditures on the next slide. Capital expenditures during the quarter, you will see total $75 million, in line with the previous quarter, and it brings our total so far this year to $372 million. Remaining for the year, we have approximately $200 million, with $42 million for tankers, reflecting progress payments on newbuildings, $36 million for Stolthaven Terminals, reflecting additional organic growth and maintenance CapEx, $102 million in STC on the purchase of additional tanks and approved expansion of depot capacity, and $20 million for the rest, including progress payments on Avenir's newbuildings program and computer systems development expenditures. So overall for 2025, we now expect to spend around $500 million on capital expenditures. If we go to the next one, we can have a look at the debt maturities. So this is the debt maturity profile. And that, of course, includes the consolidation of the debt of Hassel Shipping 4 and Avenir. If you look at the balance for '25, there's 3 portions there: $126 million, $83 million and $53 million. We have already repaid during September $126 million as it related to a sale leaseback facility and we have already secured a financing needed to repay the remaining maturing facilities during the fourth quarter, although we may roll forward the $83 million credit line to the next year as we have the option to do. If you look at the bottom-left graph, the increase in gross debt in the first quarter reflects the consolidation of the Avenir and Hassel Shipping 4 debt. And in the third quarter, we saw a slight decrease. But I would expect this to increase again with the significant capital expenditures we have planned going forward. The average interest rate remains flat at about 5.6%, and we don't expect any material swings in the average interest rate over the next quarter as the bulk of our debt is fixed. And then moving over to the next slide, a quick look at the financial KPIs. Our continued steady performance supports our covenants. And the increase in debt and, therefore, net debt to tangible net worth and net debt to EBITDA seen in the previous quarter was due to the acquisition of Hassel Shipping 4 and Avenir, and we have seen it stabilize since. Debt to tangible net worth is now at 1.01, as you see in the top-left graph, well below our covenant limit of 2.25 and slightly down from the prior quarter as well. With the lower EBITDA for the quarter, the last 12 months EBITDA fell slightly to $814 million, but as Udo mentioned, still well above $800 million. And EBITDA to interest expense was marginally down at 5.86, as you see in the top right quadrant, due to the increase in interest expense, whilst net debt to EBITDA, which is a key measure of our liquidity position, decreased from 2.96 down to 2.94, so very marginal, really remaining flat. So overall, we are well within compliance on all our covenants. And with this, I would like to hand it back to Udo for the segmental analysis of our business, our view of the market outlook and a few closing remarks. Udo Lange: Yes. Thank you, Jens. I'll now take us through the divisional highlights, and beginning with Stolt Tankers. As I mentioned earlier, tanker markets have softened as elevated supply chain complexity has resulted in softer volumes, which has had a direct impact on spot rates and performance in Stolt Tankers. Operating revenue saw a decline of 13%. This is predominantly due to a 90% decline in freight rates driven by reduced specialty cargo volume. The rate decline was only partly offset by an increase in operating days due to additions to the fleet over the past 12 months. As usual, Q3 saw seasonally low COA renewals, which year-over-year were at a rate decrease of 14.6% versus the peak last year. Operating profit was impacted by the decline in revenue as well as an increase in port expenses due to the opening of the Panama Canal. I want to thank Maren and the tankers team for their unwavering efforts to support the customers to navigate this highly complex environment, and they're really doing a great job. We now look closer at tanker rate development. The Q3 TCE per operating day was just under $25,000 per day, down from $33,355 in the same quarter prior year, which marked the most recent peak in the cycle. As a reminder, we typically fix cargo bookings 30 days in advance of the start of a voyage, with voyages being renewed on a rolling basis, which results in a lag effect of around 90 to 120 days between changes in rates and the full impact on earnings. You can see, for example, on the chart that both TCE peaks lagged versus spot index rate. Near term, we are not expecting to see signs of the current uncertainty abating. But we are seeing the adjacent MR and [ VL ] markets strengthen into the winter, which should be supportive to the chemical tanker market as we head into the winter contracting period. And we have seen some stabilizing of spot rates. That said, we are not just a chemical tanker business. We encourage the market to consider our performance across all the areas of our diversified portfolio. And I want to remind you that we have moved to full year EBITDA guidance for the business as a whole. Stolthaven Terminals positioned as an owner and operator of infrastructure servicing the chemical and energy industry results in stable and steady performance, relatively insulated from the volatility elsewhere. Utilization trended upwards in Q3 and is at 92%, which is expected to be stable over the coming quarters. EBITDA was flat year-over-year. Whilst revenues increased due to utilization, we saw some impact from inflationary cost increases and higher depreciation. We expect the storage markets to remain stable, notwithstanding market headwinds, which could result in delayed decision-making on tanker rental commitments. I commend Guy and his team. Delivering increased revenue and stable EBITDA performance is an achievement given the market backdrop. Revenue and EBITDA were slightly down in STC as the impact of the macro environment dampened market demand and transportation rates as customers took a wait-and-see approach to moving products. STC have been working to increase shipment volumes, but this could not fully offset lower gross profit per shipment versus last year. We saw a slightly larger impact on operating profit as higher A&G costs and expenses related to fleet growth contributed to larger decline in operating profit. Continuously changing trade flows require an agile approach, which suits our global platform well. Stolt Tank Containers will therefore continue its focus on stabilizing margins while maintaining volumes. Despite a challenging environment, Stolt Tank Containers contributes meaningful to the Group's return on investment and aligns with our strategy to leverage our market-leading scalable platform. Big thanks to Hans and his team for the global platform they have built. This helps us to be agile for customers and balance volumes and margins on short notice. I now want to cover our view of the market and concluding remarks, before we open for Q&A. Despite the ongoing elevated uncertainty, we see market fundamentals that remain well-balanced between supply and demand. In a world of elevated trade flow and supply chain complexity, some weakening sentiment is likely to result in 2025 volumes being flat year-over-year. However, industry expectations for the seaborne chemicals trade continue to be for modest growth in 2026, which could be supported by stability and trade policies. We continue to closely monitor GDP development as we see some macro downside risks based on market indicators and analyst expectations. On the supply side, MR rates seem to be stabilizing at a level that would typically keep them operating in the CPP market, limiting the potential to swing into our market. In addition, effective October 14, USTR 301 is expected to come into force. Whilst our chemical tanker segment is exempt from the port fees, there will be port-related fees for Chinese-owned tonnage in our segment. Whilst this will not remove supply from the global fleet, we may see some supply impact on U.S.-related trade routes as Chinese owners retrench from that trade. On the ordering side, we have seen limited growth in the newbuild order book, which has remained stable this quarter at around 18.5% of the global fleet due to the macro environment and high newbuild prices. We expect modest net growth of around 3% into 2026 and continue to closely monitor developments on risk and the resulting impact on rate supply. One important lever our industry has is the opportunity for asset owners to pull back supply in case of a market downturn. We see around 26% of stainless steel tankers aged 20 years and older in 2027, meaning that a significant percentage of the global fleet could be retired if necessary to manage supply. To sum up then, I talked to you earlier about how our chemical industry customers are being impacted by market volatility from global trade policies and geopolitics, with the resulting ripple effect into demand for our liquid logistics services. We are hearing from our customers that in the midst of this deep supply chain complexity, they really value our quality, reliability and flexibility. We are therefore focused on executing our liquid logistics strategy as a compelling value proposition that is even more important in these uncertain times. We are pursuing targeted investments, planning to spend some $500 million in 2025, positioning the business for long-term growth and making our liquid logistics solutions even more relevant for the future. This would not be possible without a strong balance sheet, and we will continue to maintain a conservative balance sheet with significant flexibility. Finally, despite the uncertain conditions, our business portfolio supports a steady EBITDA performance, achieving over $190 million this quarter. And we expect the full year EBITDA to fall within a range of between $750 million and $790 million. So to summarize, we are well positioned for the long term with the right people, the right strategy and a robust balance sheet to support the targeted investments that will facilitate our future growth. Thank you for your attention, and I will now pass you back to Alex for Q&A. Alex Ng: Thank you, Udo. [Operator Instructions] So our first question is for you, Jens, and it relates to EBITDA guidance. Your full year EBITDA guidance now implies a rather large range, between $160 million and $200 million. Could you shed some light on what the key uncertainties are here? Jens Grüner-Hegge: Thank you very much, Alex. And thank you for your question. It's a good question. I'll first like to reiterate what we have talked about the resilient business model that we do have, which is really building on multiple legs that we have to stand on. And we expect that that will help us as we go into what continues to be an uncertain environment. Udo has already touched on a number of the aspects where we are sort of building in, call it, a little bit of room for the uncertainty. We mentioned the MR market and the development of that. And our financial performance could be impacted by swing tonnage, really dependent on what we see as in terms of MR market development. We have talked about the USTR, and we think we're in a very good position there now because our entire fleet is compliant with USTR, and that means we can trade in and out of the United States without incurring any fees. But you have other operators who are not in such a position, and therefore, we could see volatility in other areas and other trades not related to the U.S. And then we have talked about the tariffs. There's still a lot of uncertainty around tariffs with U.S. recently announcing a 50% tariff on Brazilian imports and Indian imports and China retaliating. And we feel that it's warranted to have a little bit of a headroom for those kind of uncertainties. Just like to remind you that when we talk about sort of the volatility in net profit or in EBITDA related to a swing in time-charter equivalent, typically, we have said that a $1,000 swing in TCE related earnings equates to about $6 million to $7 million in EBITDA. So that's for you to keep in mind when you look at -- do your own sensitivity testing. Alex Ng: Thank you, Jens. A question for you, Udo, again, relating to trade policies. Do you expect any positive effects from the tariffs in the longer term? Udo Lange: So of course, this has puts and takes. So at the end, if you look at our business, in particular, when it comes to the tankers, that probably you have the biggest impact, it's all about ton-mileage growth. And so depending on where the tariffs are on which products, but then also what that may open up as other trading opportunities, this can also fall into the positive way. So it really depends what are the specific tariffs, what is then the impact on that trade, and is there then an attractive alternative trade which potentially could even drive more ton-mileage growth? So it's really the devil is in the detail on this one. Alex Ng: Thanks, Udo. And next question relates to CapEx, so one for you, Jens. I'll just combine a couple of questions. But the first element is, we've noticed an increase in CapEx for the end of the quarter for 2025, particularly in relation to STC. Could you provide some insight into what types of projects they are and when they could be expected to improve earnings there? Jens Grüner-Hegge: So related to the STC CapEx, sort of consistent with our ongoing desire to build on that scalable platform that STC has built by increasing our tank size, our number of tanks as well as expanding on our depot capacity. So this is consistent with our strategy. I'm sorry, Alex, the other -- when we expect to get the -- well, the nice thing about investing in tank containers is that typically the lead time is significantly shorter than it is when you invest in the more longer-term, capital-intensive businesses like tankers, terminals, et cetera. So what we are spending now, you will start seeing the benefit of in 2026. Alex Ng: Thank you, Jens. And then a follow-on from CapEx. Could you elaborate on what the CapEx spends are in 2026? And how is it phased throughout the year? Jens Grüner-Hegge: Absolutely. Again, thank you for the question. So there's 3 big buckets for 2026. It's tankers, it's terminals and it's what we have grouped under corporate. For tankers, the bulk of it, say, 80%, 90% of it is related to the newbuilding program that we have, so that's about $120 million of the total and a little bit to be spent on barges. For terminals, about $80 million relates to our ongoing investments at our Houston and New Orleans terminals, the organic growth that we have previously announced there, that will come on in 2026. And the rest is sort of steady maintenance CapEx that we have ongoing every year. And then for corporate, you can split sort of 80% with Avenir and 40% related to Stolt Sea Farm. For Avenir, it's related to our newbuilding program there. Alex Ng: We have a question on the USTR and managing uncertainties around the enforcement of this. Do we have any exposure in relation to the Chinese built, owned or operated vessels? A question for you, Jens. Jens Grüner-Hegge: Can you please repeat the question? Alex Ng: Yes. It's relating to the U.S. restrictions around Chinese-built vessels. Do we have any exposures there? Jens Grüner-Hegge: Sorry. As I mentioned in the previous question, we have made sure that we have no Chinese-owned ships in our fleet. And therefore, we are at full liberty to trade in and out of the U.S. without any additional port charges. Udo Lange: I just want to add there and really applaud the teams. So a particular big shout out to Maren and Bjarke from the tanker side, and then Nick, our General Counsel, and then Jens and the team as well. Because I think 2 key things that we have done extremely well is, one, really advocating the position on with our customers as well as with the administration in the U.S., which was key for getting the exemption. But then really, Jens and the team looking at where do we have any exposure from a financing side and then cost-correcting there as well. So we can proudly say at this point in time, thanks to the agile leadership of the team, there's zero exposure for Stolt-Nielsen on USTR when it gets into effect. Alex Ng: Next question is in relation to Stolt Sea Farm and the performance there. So one for you, Jens. There appears to be a large fair value adjustment in that segment. Can you explain what it's in relation to? And any other comments around the strong performance and how that's being driven in Stolt Sea Farm? Jens Grüner-Hegge: So dealing with the fair value, as those of you who have followed us for a while will know that that's always something that fluctuates up and down. It's more noise than anything going through our results, which is why we also report our EBITDA excluding the fair value effects when we talk to you in these presentations. The magnitude of it is -- was between $6 million and $7 million this year, but there is a negative one in the prior, the same quarter last year, which is why it causes a big swing. And the driver of results at Stolt Sea Farm is similar to what we talked about before, it's volume and price-driven and really a sound operation that we have built there. But normally -- so we changed to not talk about it because it is very small in comparison to the overall balance sheet. If you look at Stolt Sea Farm, this comprises less than 10% of the asset base. I think it's actually down to around 3% to 4%, Alex. So that's why we have now elected to really focus on what truly drives the results of the Group, and that is our logistics businesses. Alex Ng: Thank you. [Operator Instructions] Next one is relating to the debt profile. Can you give more insight on that $93 million debt repayment during the quarter? Was it primarily paydown or early repayments? If you can remark on that. Jens Grüner-Hegge: Yes. So some of it was early repayments related to ships that we previously had on sale leaseback. And that's partly also what -- that's partly what has allowed us to now sit with a fleet that is non-Chinese owned. And in conjunction with that, we have also taken on a few additional refinancings to help position the company for '26 and the capital expenditures that will come in the future, putting us in a very good liquidity position. But our debt balance, as you have seen, then continues to evolve with every quarter. And that is so that we can make sure that we get the best rate structure and the best profile structure for our asset base as we move forward. Alex Ng: And the final question that we have on the list is, can you provide any guidance in relation to dividends expectations for -- payout for the year? For Jens. Jens Grüner-Hegge: No, the dividends are really something that is determined by the Board and determined by -- eventually approved by the Annual General Meeting. They take into consideration our financial -- the markets that we operate in, our financial position, our commitments going forward. And this is a holistic evaluation that the Board makes. So beyond that, I think all we say is we've typically been rather steady in what we have been doing, but those are considerations for the Board to make and not for me to comment on. Alex Ng: Thank you very much. Okay. Thank you. That completes our questions. We'll post a recording of the call on our website tomorrow. Udo, back to you. Udo Lange: Yes, thank you for joining us today. I look forward to talking to you again when we present our results for the full year. Again, thank you, and I wish you all a great day.
Operator: Good morning, ladies and gentlemen, and welcome to the Blackbird plc interim results investor presentation. [Operator Instructions] Before we begin, we would just like to submit the following poll. And if you could give that your kind attention, I'm sure the company would be most grateful. And I would now like to hand you over to the team from Blackbird plc. Ian, good morning, sir. Ian McDonough: Good morning. And ladies and gentlemen, thank you very much for joining this morning for Blackbird plc's interim results presentation. Today, we're going to take you through a lot of information. We're going to take you through product strategy, marketing strategy, talking to our early metrics and talk about what happens next. And of course, as always, have an extensive Q&A session. Before we start, I want to talk about one particular thing, which is where we are in the journey. We are on product market fit stage, and we've talked about this when we came in June and also back earlier in March. In our product market fit stage, we are learning. We are delivering features, still very basic features, actually, and we're learning from that data. We are not in our scale-up phase at the present time. Our product market fit stage is going to run into 2026 and it's at that point, that we will move into our scale-up phase. What's interesting about the product market fit phase from our perspective and from your perspective is that it's generally done, 99.99% at times in a private environment with VC-backed companies generally on the West Coast of the U.S.A. This is a very different scenario. This is a public company, that is taking place in the U.K. And as such, it's a rarity. It's an outlier. It's a possibility for us also to invest in something that is really potentially very, very special. I don't see Blackbird and elevate as part of Blackbird as being a 10 bag or a 100 bag. This is potentially an enormous return. This could be 1,000 plus bagger. And I think in that respect, it does come with risk and it does come with patience. If nothing is nailed on in this, and we'll do something that is ambitious and potentially industry-defining industry changing. So please make no mistake about what we are trying to achieve. But we are very close now in terms of our developments, certainly in terms of the length of time this company has been around to reaching that growth period to reach an ultimate growth period. So I think that I would finish my introduction by saying I have been meeting a lot of actual potential users recently. There are people who are working in teams that are people are making -- responsible for video on a day-to-day basis. And I've never been more confident that we have the right vision to elevate that we have the right product to elevate. Do we have the right timing to elevate to deliver into a huge global addressable market? So with that, I'm going to start the presentation and now I move on to the first slide. Sumit and I are going to be presenting today. I think you almost know him very well. He is our Chief Product Officer, and indeed responsible for a great deal of the vision that you are experiencing with elevate. Now we are starting a revolution. We are starting a co-creation revolution. This is something that we've identified with our ICP, which is founders, entrepreneurs and small businesses but by their very definition, they are working in teams. They are co-creating. But right now, there is no workflow that is anything other than a slightly archaic linear format where they're frustrated by this on a day-to-day basis. And just to give you an idea about the scale of that ICP in the North America alone are well over 40 million small or medium sized businesses and that's without the rest of the world being thrown in. So it's a huge potential market. And let's share a few words from recent events we've attended in the U.K. [Presentation] Ian McDonough: Right. So obviously, [ I've lost a day ] there in Hertfordshire where we went a couple of weeks ago, but really rewarding to hear the feedback on people's first impression of elevate. It's got better since then where we gone through marketing events in the last few weeks where our people are, again, as I say, using collaborative processes on a day-to-day basis but have nothing that really satisfies their needs. So on the slide here, we've plotted our product road map on the lower axis there against the potential growth that we see, the growth that we're looking to deliver. This is really a guide to where we are today, which is pretty much halfway through our product market fit phase where features are delivering at pace and Sumit has some exciting news on that to talk to you about in a few minute's time to really take us to the next page, which, of course, is scale up into 2026. So some early leading indicators. Well, so I've got quite a few different range of numbers here. The first one is on -- in terms of sign-up users. We've got 110,000 signed up users now to elevate. This really shows that there is a problem in the market that we're looking -- that we are there to solve, right? It doesn't necessarily mean that we have to put the solution yet, but it certainly means there is a problem solution fit. In terms of conversions, we now converted almost 700 people into being paid subscribers. As you can see on the next number in terms of retaining those subscribers, then churn is suddenly a focus for us. Churn is something that we are already making sure that we address and that is mainly through new features, and features that are being delivered on a rapid basis, but also through alignment to our ICP and almost also to engaging those users along the way. Now we could have spent more money in the last few months on making sure that when we came to you this time that we had a high number of current paid subscribers, but it wouldn't have been money well spent, we're really now focused as a business on making sure that we're delivering the right features at the right time to improve that churn number to make sure that we are going to be spending the money the correct way. We've got 1,450 returning users in August, which gives us a really nice trickle of users to make sure that we have enough data to make sure our features are running well. And since launch, we've had an 81% increase in engagement. So that means that people that have come meet the product have ended up exporting a video at the end of it. So again, it is a really good idea that we are improving all the time with our features. And what we've done now is really trying to line up more with our ICP. Again, the ICP, just to remind us, is those founders, entrepreneurs, small businesses and small marketing teams that are a larger number and engaging those guys to use elevate on a day-to-day basis. A few -- a brief look at some financial metrics. We've had some quite good improvements here. We've had a 21% improvement in cash management over the year. So that is down to GBP 1.5 million in the half. We've had GBP 600,000 worth of revenue come in. It's slightly down on the Blackbird side. This is mainly due to some [ ideal ] losses, but also the non-repeating transaction happened in half 1, 2024. But the positive news is that Blackbird is now EBITDA positive in H1 for the first time. We also did a small top-up raise to take us through the product market fit stage over the summer of GBP 2.1 million gross proceeds. I'll now show you a short video, which is a rough cut of a YouTube video that will be released shortly, showing how elevate is a collaborative feature -- a collaborative platform for marketing teams and social media teams. [Presentation] Ian McDonough: Excellent. So also got a sneak preview there on our first partnership and collaboration, which is with the London Cavaliers so more used to come over that over the next few months. So why is elevate needed? Why is elevate required? Yes, it's very simple to use, and that's a huge benefit to the people. And yes, it allows complete freedom to operate from the browser, which gives access and freedom of movements. But the most important thing is it's collaborative features. Collaboration is not just at a niche part of the way teams work. Collaboration by definition is exactly how teams work. And it's not just a multiplayer aspect of our platform either which is, of course, the [ jewel of crown ] that separates us out from really everything else. But the fact is that we have this incredible access to assets as well. So we can manage assets. We give immediate access to teams assets. There is no upload and download. And of course, there's instant review, which we just launched in the last couple of weeks and of course, the leaving of comments about asynchronous collaboration. So it's a much larger part of the workflow, they're just purely the multiplayer, but the multiplayer really does differentiate us from any other editing platform. But the integration with everything in the back end as well is hugely, hugely important. Now why us? This is the investment case really. Why would you invest in Blackbird plc because we have elevate? Well, first of all, we have the technology, and you've heard about the technology many times. This allow us for a fast manipulation of content under low bandwidth conditions in a browser, and that is completely game-changing compared to any other platform out there. And it's given us a massive head start in terms of just how we've managed to develop elevate and have it in the market. We've heard that many times before. I just want to focus on team for a second. Team -- I've never worked in the team that is as talented or as efficient as the team I currently work in. And that goes from everyone from Sumit and his product team to the development team to our marketing teams, they are exceptional, and we are really -- we're very lucky to have selected such an amazing group of people. And we are very active in making sure that we keep those people at the very best levels. And the other thing that is really important to mention here is TAM. As I mentioned at the very, very start, we've got a huge global addressable markets. And this global addressable market is not just video editors, this global addressable market is all the people that work with video. I saw an interesting anecdote recently about Uber is when Uber presented their initial investment deck. They estimated their TAM to be the entire taxi market of the world. But they got it wrong. They were out by factor of 8. It was 8 times bigger than that. Because before Uber, people didn't take taxis, it was too difficult. They took taxis once or twice a month, and now they take taxis two or three months a week. It's a huge, huge different proposition because it meant -- Uber made it so easily. Figma had the same situation. Figma have a channel that was very small when they first launched because no one has designer software unless that you were a designer. Now every one of the company has access to Figma because it's so easy to use, and you can review and approve and you can input on the design as the process goes along. Elevate is very similar. So when people came to us over the last few weeks and said, yes, we have one or two Adobe licenses in the company and then people send me the exports of products, I write back my feedback on e-mail, and that's how it works. Elevate will be entirely different. Elevate will be -- they will have access to that video directly, they will be a customer of ours, and therefore, our TAM is many times larger in fact, than the global video market today. It gives you a bit an idea about TAM -- about the investment case, right... Sumit Rai: Hi, everybody. And so when it comes to products, I think I want to you on a little bit of a journey of where we started the product market phase where we are today and where we're going. So if we cast our eyes back to February when we actually put in the gateway and we sort of went out into the market. What we had put together was essentially an editing and collaboration capability. It was so crucial for us to get the collaboration elements built into the product early on. There's no way they can be added later and it's such a fundamental part of what we do. And this is something that people are only just beginning to understand is the importance of collaboration in the elevate story. If we were just building a video editor that was just trying to compete functionally with the desktop tools, we would have not much of a future because we'd be fighting against incumbent and we'd just be able to do what they can do, but they can already do it. What was so important for us to acknowledge that just like lots of other adjacent industries in design, in 3D, in accounting, in CAD and general marketing, products have come about that actually enable teams to work together to achieve something. That doesn't mean that everyone becomes Ridley Scott overnight. It doesn't mean that everyone is going to become a colorist, but what it does mean is that they can get involved in the process. So we put in place, as we launched what was not hugely available to everybody was a lot of that collaboration infrastructure. What we were light on and we were well aware of this was the general editing capabilities in the way effects. Our media management was very, very lightweight. Processing was -- we're lucky that we've obviously got the infrastructure and the experience from the original Blackbird product to help us. But that was also limited to a bit of a broadcast model, whereas we operate obviously in a much broader model. So we went to market with what we knew was the foundation of what we did. During that product market phase section that we're in at the moment, we've learned an awful amount from our users. The telemetrics that we have in the product tells us how people are using it. They tell us when they're using it, they tell us to what extent they use it, and it shows up where there are problems or misunderstandings in how the product works. For us, right now, the value comes from having small clusters of users in these customers, which gives us a really good indication of how it works in education or how it worked to finance or how it works over here. What we don't need is 10,000 users in each one of those sections. We get more than enough from the users that we have that are free users and of course, the paying users, which we can learn a lot more from because when you're paying for something, your behavior tends to be slightly different towards it. So when we've arrived at today, based on all the information we've understood, we've increased the collaboration capabilities, the recently released review mode has been incredibly -- has gone down incredibly well with users, we've increased some of the editing. What we've made a big move forward is on media management. As we know, we're not just building an editing tool, we're building a collaboration tool, editing and media management and we obviously have future plans for other things, too. But the media management is something that is almost impossibly done today. In fact, just earlier this week, we were with an analyst and their exact story was the hard drives for the projects that we get made for us just sit in someone's bedrooms stacking up over time. That was the exact words and you never see the active experience that we had from people. So we know that media management is an opportunity. It's a whole business in its own right. We are in our infancy of it, but we now have team folders within the projects themselves. And as of today, team folders will be released. So the entire team can have media management at the top level of the product, not just within each of the projects. Our effects and transitions, we have a lot of interesting things coming, but there's a lot of work that's happening behind the scenes that people won't have noticed. We've quite severely improved the way that the video editing is compositive within the product. And that's going to give us a lot of opportunity to use gaming technology to actually produce a much more advanced effects using the GPU on the computers, which is now becoming prevalent. This is incredibly important, especially for the low-end machines like Google Chrome. Of course, our accounts and payments were increasing the ability for us to manage people. It's also super important that we ensure that our way of managing our customers has done really well. During this period and up to this period of time, we had an unbelievably high availability. The system has been there. We've had minimal disruption. We've been able to identify where problems are lurking and we've been able to deal with them now before we have a much larger user base. So I'm incredibly happy with how this phase has gone. But of course, we're only halfway through the product market fit phase, and we've got a lot more to come. And this is where we see things moving when we get to the end of that phase. We will improve the collaboration further more, which we're really happy about. We will include more editing. You'll have noticed in the last week, we introduced fundamental editing tools like the preview in and out points. We've got a lot more of those to come. Our media management will be improved including things like search that you don't get in other products. And our effects and transitions are really going to come to life. Another area that was released just today and is only available as of about an hour ago, is the mobile upload capability. So anybody who now accesses -- from your phone, if you access to your elevate accounts, it will give you a web interface where you can upload content directly into a project or a team. We advise people share it to their home page, so they get the full experience of a progressive web app. And it's a great experience only at the beginning, we know that the mobile element will play a vital role in collaboration, and it will play a vital role going further forward in things like distribution. We're going to be improving our accounts and payments to incur different types of payment links as well as different types of accounts. And as I mentioned, our media processing will just improve further and further to cope with a much wider range of file formats. From an AI perspective, we've already introduced a very lightweight version of AI, but we've got lots of really exciting AI integrations with third-party companies coming. And that makes the beginning of our marketplace. It's only a small effort by the end of this, but it's going to be the thing that will be useful during the scale-up phase. Over to you. Ian McDonough: Great. Thanks, Sumit. So on the marketing side, our marketing, of course, will naturally trail product because it's really important that we are data-driven that we can see that the product is delivering on the feature side, which, as you can see, is rapidly happening with such really exciting news happening with us a few days and even this morning. So we -- our market story started with search, and we started with search last September. Search totally did bring in a large number of users. But search doesn't lead to engaged users. And we wanted to make sure that we have engaged users as we go through this product market fixation. So learning was always going to be a little bit limited from those guys. So where we are now, we've broadened our marketing strategy out to include events. So building awareness to our ICP directly through events and PR as well. If you want to see some stories come out about elevate over the last few weeks and indeed through organic social videos. So there's been a lot of work done in the background on that as well where you've seen our team deliver our videos to Instagram. And our Instagram views have gone past 100,000 now. We've got over 2,400 users followers on Instagram. So it really shows that there's an effort there to make sure people come and understand elevate that they understand what elevate can do, what it's for and on our message. And as features start to land, we'll build out this further, and we'll really start to unlock over the next few months as we go through the final market fit stage, access to much larger audiences, audiences that will be evolved through partnerships and through influencers and through referrals. And referrals, of course, will be the start of that product-led growth as well. So this will all happen over the next few months and through the back end of the markets fit stage. So in conclusion, I'm going to finish the same way that I finished my intro, which is over the last few weeks, we've met a lot of people who are directly interested in elevate.io. And I've never been more confident in the fact that we have the correct vision to elevate.io that we have the team that can deliver elevate.io and we have that ability to execute over the next few months. So thank you very much, Ladies and gentlemen. We will now take questions. Thank you. Sorry, we're going to finish with a video that shows the portability and the accessibility of elevate.io through another Youtube Ad. So one second... [Presentation] Operator: Perfect. If I may jump back in. Operator: [Operator Instructions] I'd just like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A can all be accessed via your investor dashboards. [Operator Instructions] And guys at this point, if I may just hand back to you to read out those questions and give your responses where appropriate. And if I pick up from you at the end, that would be great. Thank you. Ian McDonough: Thank you so much. Okay, I'll start and I'll read through the questions. First one is for Sumit. Can you please tell us what about your plans for the marketplace and the kinds of companies and services you are hoping to [indiscernible] in the early stages? Sumit Rai: So the good news is, is we've already begun work on the marketplace in the things like the AI services that we've implemented are essentially like the market that are using third-party services. We don't have to have other companies buildings. We can build certain marketplace items ourselves that interact with other companies. In this case, OpenAI has obviously been our first partner. However, we are working with very well-established media companies who make things like visual effects in terms of how do we actually bring some of their technology into us and make that available to others. So it will be in the workspace visual effect, it will be in the space of data provided, obviously, the AI providers. And of course, distribution. So going out to other platforms, YouTube for instance, and we can do that work ourselves. We don't have to have them do it. But yes, we'll obviously -- as soon as we had established, we do want to have more and more companies, we want to take [indiscernible] and build the things themselves. Ian McDonough: Excellent. Second question, I know Blackbird can help almost any type of team or creator, but having worked in creative agencies, it seems particularly ideal for that market. Have you considered positioning elevate as a video editor that's tailor-made for creative agencies? Sumit Rai: Yes, I wouldn't say that we want to tailor-make it for any specific industry itself but it is a great use case. And we do believe that the creative -- we're already beginning to see creative issues that companies that we're working with ourselves as a company, seeing the value of elevate, even the people who worked with us to put together some of the marketing assets, the video that you've just seen are instantly seeing the value of the product themselves and we've been using, obviously, to build out the content. So definitely, the creative industries are going to be a market that we're absolutely going to want to go for. And we believe that the way we're setting up the product means that creative agencies can much easier help organizations that have elevated results with some of the higher end work and things like that. So it's a definite industry that we want to be working with. Ian McDonough: It's a great observation. And again, it comes back to the collaboration point as well, which is creative agencies by definition, work in a team environment. whether it's just within their own team or whether it's with the clients. Some of the feedback that we've had over the last few weeks is that we've always talked about how elevate helps with speed and ease, it's more than that. It helps to make it bearable. I mean it's almost unbearable the way that the teams have to operate now today, whether that's uploading, downloading stuff and sending stuff like e-mail backwards or forwards. We've really thought about this process. Sumit's team and the product team have really thought about how this process should happen. What's the logical way this process, this workflow should happen? So yes, absolutely, creative teams are very much a part of our plan. We are delivering two ICPs where the features that we have today really resonates, and we will move towards creative agencies as we get further down the line. Question for Ian. During the IT presentation after the AGM in 2024, you stated, we want to build a company worth in the tens of billions. Today, are you more or less confident about that ambition and why? I mean I said it a couple times in the presentation, I'll say it again, I'm very, very confident. And the main reason that I feel confident is that on the product side and on the debt side, we've solved so many problems, we've created this product, it works beautifully. We are laying our features at pace and we are now in direct conversations with our ICP that are the people that will buy this product, the people that will use that product on a day-to-day basis, and they will talk about how this quarter works for them and grow the product there. So I've never been more confident about how this product and this company will grow. It is an excellent time, I have to say, a very exciting time. Question 4. My concern here is other tech companies are moving faster than us. We do not seem to be selling our product. And the sale side is failing because the product of the product developers -- failing the product developers. We are too slow. We are promised further news in September, which has not materialized. We need to update our information on the sales side to be more effective. I will revert back to the very first thing I said, which is we are in a product market fit phase. The product market fit phase allows us to be data-driven to make sure that we're developing the correct product at the right time for the market. We will scale-up in time, but we need to, at this point, get that product absolutely right. There is literally no point spending vast amounts of cash on a product that isn't ready for the market, to be scaled. Sumit Rai: If I can add to that, sorry, for a SaaS company to accelerate in the wrong direction is a guaranteed failure. If you put -- if you don't have these clusters formed and understand where the earliest success is and then accelerate into them, and you just go into the whole market, you can't boil the ocean. It won't work, there's a catalog of companies that tried that and have just burned through cash and failed miserably at the tail end of that. And a great number of successes with companies that have gone about it in the right way and therefore, found their areas then lead into when they go to the scale up phase. Ian McDonough: Excellent. Question 5. Could you give the current cash and short-term investment balance at the end of September? Stephen White: Whilst we can't give you that cash balance because we're in a closed forum, and that would require an RNS. What I can do is give you an indication. We had GBP 2.3 million of cash and short term investment at the end of June. We've all seen proceeds of just under GBP 2 million from the fund raise subsequent to that period. And in the last quarter as well, our cash flow was a six figure number, so I'll let you do the math. Ian McDonough: Thank you. Question 6, what's your goal for the product market fit stage in terms of users and MAUs and paying subscribers. The conversion of MAUs to payers has grown at 24%, while conversion sign-ups, 110,000 to MAUs so low, what precisely are you doing to address this metric? Well, our metrics really are going to be around engagement, around retention and around conversion. They are the key things that are really the leading indicators to whether that we'll make elevate a success. Yes, we agree that certain areas of the conversion are currently pretty healthy and some need focus. To answer the question about the 110,000 to conversions though, I will just pick up on that point, is that we started this in September 2024. We originally -- we were using our search budgets for a wide variety of markets, again, to learn, including India, including Philippines, and including other market. Where there wasn't a very high propensity to pay, but it was for data. And therefore, we wouldn't always expect those subs or those users to come back directly into pay subscribers. So there's a variety of reasons for different levels of conversion. I think we are at the point I would really have to leave you with is really about those leading indicators of retention of engagement and then conversion. Anything you'd like to add there, Sumit? Sumit Rai: I think to reiterate the point that, as you pointed out, the conversion of the regular free users that we get is low that we would be managed for us to do more of that at this stage. And again, find those clusters, and timing those early adopters is the goal of the product market fit phase and at the back of that, we'll not only have the products that is relevant to them and more, but we will have a deep understanding of those users. And that's what we lean into. Ian McDonough: Question 7. Why have we not released a player? Was advised as it was part of the overall elevate project, clearly, if we release the player by itself. In the past, many shareholders want it, maybe that would have increased the share of value as I understand the player would have been a successful tool that substantially increased revenues and share value. It's a double header for [ YouTube ] guys. Stephen Streater: Player, we've been using it and the technology in the player, we've pushed straight out and elevate once it's been tested, and we've been using the player as a testing tools for the technology. Because what we want to do is to get elevate to be really finished and beautiful before we start diversify too much. But what we have decided is that we will make the beta player available to all users so that people can try it, and there's quite a lot of technology coming down the pipeline that we will be able to test in the player. So I think you can expect for the user to want to do it, which is quite a few, they will have access to it but the key focus has to be to get the editing function working and then we will learn almost like product solution fit stage with the player, what sort of things people are looking forward there. Sumit Rai: You've also got to look at the order and the relevant buying order. The distribution capabilities of elevate are cream on the top of when where into the established market, they're not. We have to have that first, otherwise we're not going to have to users to warrant the use of the player. So right now, it's more important that the player is being used to build out the playback technology. The player division has pioneered the new way of compositing and the way that we're handling and working with things like the GPU, which will not only just help the editing process but will actually help the output -- the ultimate output. So it's a joint effort. And of course, the player is the testing bed for the new codec and the way we let things work in elevate. So we are -- it is happening, you just can't see it. But anytime you see a video playing back within elevate, you are looking at the player. Ian McDonough: Thanks, Sumit. Question 8. Can the company explain why it has failed shareholders so badly to allow the price to have dropped so far and what is the remedies to restore shareholder value? Can we please, from now on, have target dates but the company agrees with shareholders to meet. Sumit, can we have [indiscernible] the outstanding features, which the shareholders want so if go to the next stage, when will we meet the prosumer stage? Okay. So I'll take that, there's a quite a few different points in there. Why have we failed shareholders so badly? Well, I mentioned before, we're in the product market fit phase, right? We're putting out information fairly regularly and numbers too to explain where we are with that stage. And what that stage really means to you guys as investors, but also to the customers, which are also important to us. And it really is about delivering features on a rapid basis and leaning from those. Now in terms of when we are going to start delivering those features, Sumit, I know that they're coming thick and fast, do you want to take that part of the question? Sumit Rai: Yes, we -- the development process that we run through is an agile process where we make a release. It's a couple of times a week. It's just -- you don't always know about it because it's often things that are happening behind the scenes. And when there's obviously something notable, we do tell everybody and we -- the last couple of weeks, we've had a good cadence about one a week. Over the summer, things were slightly slower, but even before the summer, we were in the same process. It's really important that we don't rush junk out the door. The easiest place to kill our effort going forward is if we put products out if it's instable, not thought through and not good for users to use. We'll get absolutely nowhere. So whilst that might be frustrating from a shareholder point of view, it will only guarantee a further erosion of shareholder value if we actually are halfway -- 90% of the way through a bridge and it's the last 10%, well we'll just make it out of polystyrene, you can imagine what the outcome will be. So we're really going to stick to doing some things in the correct way because it's so important that we do the correct way for the users and if we do it the correct way for how our product will grow and have the future, just putting some in the market now that's under vision or not complete or incorrect with be catastrophic. Ian McDonough: I think to finish this question as well. This is where I take the visionary investor is that we've derisked this product enormously. So we started off with a PowerPoint document back in 2022 and have now come to a functioning product that has audiences that has customers all around the world and works better than any of the product that even comes close to trying to do what we're doing. It has been a fantastic achievement, on behalf of the teams have worked for us. I mean I'm really proud of where we got to. Unfortunately, the institutions or at least a couple of institutions haven't recognized that, haven't seen that, that is something of an achievement and haven't seen that derisk. A number of them have sold out and that has been damaging to the share price. I think this is where the visionary of investors, and I hope we've got quite a few of these on the call is that look at the share price now, look where we've got to, right? This is an absolutely -- it's a huge opportunity for people to get involved with the stock right now, I have to say. Because, yes, we've come as far and we've -- we are so much closer to be able to show that growth. And if you understand what we're saying, what's Sumit saying about where the products has got to then I'm sure that you'll understand the investment case. But yes, it's a shame that the rest of the market, certainly some of the institutions haven't seen that. Stephen Streater: We haven't seen them yet, let's say. Ian McDonough: Correct. What is our relationship with [ Avid ], rumors was we are doing a deal with them? No. [indiscernible] We're not in the [ Avid ] area at this stage. We're very much in the greater economy and [ Avid's ] not out there. For Blackbird ex elevate, the second half of 2024 EBITDA was [indiscernible] Stephen White: Yes. So for Blackbird elevate, the second half 2024 adjusted EBITDA was GBP 672,000 given a full year of GBP 490,000 is GBP 600,000 plus the expectation to second half adjusted EBITDA for Blackbird excluding elevate bringing it to 700,000 plus the -- plus for the full year after first half 1 of GBP 127,000. What I would say on that one is that yes, revenues year-on-year is not going to be the same neither is our cost base. We're not going to give our forecast by division at this stage. But as for the guidance that we gave in the RNS, we're expecting that Blackbird to be profitable for the second half of the year and the full year, too. Ian McDonough: Okay. Next question is finance question as well... Stephen White: Yes. The first half '25 [indiscernible] hasn't moved much at GBP 500,000 cases for 6 months. Can you break this down? Is this all salaries of how many people? It's principally the Board plus one other member, 80% of those costs are salaries and associated costs such as employers, national insurance. The other items in there are our cost being listed such as London Stock Exchange cost, or [ NAND ] costs, or audit cost, et cetera. Ian McDonough: One more finance question, please. Stephen White: Can you break down first half operating costs? Blackbird excluding elevate [indiscernible] have been halved, this all employee reduction. Yes, the vast majority is employee reduction on the Blackbird side, but also we have repurposed some of the team as our focus of reinvestment is on the elevate area. Ian McDonough: Okay. So a lot of questions here. So could keep the questions a little bit longer, please. So we'll get through these questions. So first one, my question on the definition of product market fit the capital efficiency. The company is investing heavily to build features for the highly competitive professional creator market, yet there appears to be a clear product market fit stage with existing products in the enterprise sector. For instance, large finance institutions like Lloyds or Barclays could immediately deploy this for internal trading. You need to rapidly create and share videos on everything from new software rollouts to critical compliance update. This market represents immediate multi-seat license revenue. So could the Board explain strategic decision to price as a cash intensive development rates over pursuing these large-scale enterprise contracts to be landed now and what is the sales team actively doing to penetrate this corporate market? Stephen White: Yes, so great question, really thought through, and let me give you some -- a little bit more clarity on something where you've said that we're targeting the higher-end creator market or [indiscernible] market. We're not. We've been quite clear that one of our big ICP is the enterprise sector. There is a slight difference in that you're quoting Barclays and Lloyds and we are more looking at the SMEs. And there's a very good reason for that because it may seem like, oh, we can just very easily deploy it there. Barclays and Lloyds are two companies I know very well. I've built their streaming infrastructure, I know exactly how you build video product within those organizations. And unfortunately, the procurement process to do that and the amount of hoops we have to jump through with organizations like that would not give us a quick-to-market ability to build revenue. We are more interested at the organizations that we've been meeting in the last two weeks at the technology and marketing forum and Ideas Fest organizations that can move very quickly. Barclays in Lloyds are absolutely our target at the right time. I know the people are, they've got auditorium, they have edit suites. I know the person who runs the video. So we absolutely want to be used in those organizations but getting in the -- as a cloud product, getting in and deployed within those organizations right now is actually something that would take longer. So we are going to be going to be focused on enterprise. We definitely see -- and this is very much the Figma story. Figma is promoted and loved by designers our freelancers and small agencies, but really they make their money out of Unilever. It's the 1,000 user -- sorry, the 1,000 customers they have that spend GBP 100,000 with them. That's our North Star. We definitely know that elevate, more than any other video editing products, will be able to scale into larger organizations and provide through their desktop editing capabilities. And it's a market, I know very well very passionate about, but not one you could just easily walk into. Ian McDonough: Excellent Next question. My question is on the definition of product market fit and capital efficiency. Also that was a -- [indiscernible] I have a process question based upon yesterday's Barclays Eagle Labs presentation, when a marketing presentation and engineering presentation delivered by the same person with a clear barrier between the two so much so they called it out after finishing their marketing element. The presenter was obviously an expert in the engineering details, that seems less comfortable delivering the marketing message, which is the first part. I would agree. Thank you for the question. And I would say that yesterday's presentation didn't meet our normal high standards of our product that we put to the market. I think we've all learned a little bit there. And it is an excellent presenter when it comes down to the, as you call it, engineering, but on the -- actually the editing side of it. But yes, we've learned that we certainly should have a two-handed approach to that and make sure there's a presenter that can deliver the marketing messages proficiently as well but thank you for the question. And I was hoping you could elaborate on the evolution of your growth strategy. The aggressive exponential growth curve that we outlined back in May appears to have shifted back towards a phase focus on achieving product market fit. Was this slowdown a deliberate strategic choice to prioritize product quality and user retention over share acquisition numbers? Was it more of a reaction to the market headwinds. And crucially, what milestones must be reached before the next one expect a return to exponential growth? Great question. And yes, there was obviously early signs of exponential growth, which is fantastic. What hit us with the churn and therefore, we've learned from that churn and make sure that the new subscribers coming aboard and the new users and subscribers coming board are engaged users that align to our ICP. So I'll reiterate the key things that we're looking for going forward in terms of those metrics. Our retention of those subscribers is engaging with those subscribers and conversion into pay. Those are the key areas that we're looking at. They're the lead indicators of what we're doing. And yes, it is an early phase. Sumit Rai: And I think that we could have continued the expenditure that we were making as such and continue driving through that, and we would have over 1,000 paid customers right now. We could have easily bought users. That doesn't help us. What helps us is we learn enough from the circa 350 that we have that are telling us and informing us about everything. We don't need 3x as many, that would have been too costly to acquire. What matters more is that as soon as we work with those 350, we'll you use the money we've got to acquire 2,000 rather than 1,000. So it really is about being disciplined and us pulling back where we needed to at the right moment rather than just for the sake of pushing a narrative that is still only in the hundreds, it would have been futile, it would have been. Ian McDonough: So a linked question there, Sumit. With around 50% of all paying users having churn, what level of retention uplift do you expect once the missing features like captioning and mobile uploads and graphics go live? And when will those features be fully released? Sumit Rai: Yes. So mobile upload, obviously just gone live. Captions has been very, very actively worked on, and we're hoping to see that by the end of the year. And we obviously are very -- well, there's a whole bunch of other features that are coming out especially in the graphics and animation space and transition space and there are others, by the way. And some of the graphs that show things, one of the biggest impactful things we've added recently was the Boundary Boxes. That was a very expected behavior that we wish we had sooner, and we've now put out there. All of these features, and we talked about quite a lot in the team recently, people come to us for the big features, but they stay for the little things. So just simple things like the folder management and relabeling things and some of those smaller features that we've neglected a little bit in favor of bringing in some of the bigger features. We now have a dedicated team that is going around ensuring that when people are in the product, they have everything they need. And churn is a result of them not being able to achieve what they need to do in the most convenient way and so we now have to work on the, okay, what is it we need to do to keep people on the products. We've learned a lot about bringing them in. What do we need to keep them in there? And what are the things that they absolutely need to get about doing their day-to-day. And how do we prioritize that. And like I said, we established a new team that is dedicated towards the smaller, more hygiene factor features that will help reduce that churn. And of course, in time, as we just had some of the bigger features that will also help reduce that. Ian McDonough: I think the other point as well about the number of paying users is when we reported back in May, we were at half-price. And we could've continued to go half price and see that conversion change. But we're in a learning phase. So when you double the price of a product, you're just buying a new metric, you're just buying a new standard. And of course, we're just now by standard of $15, GBP 15, EUR 15. And as the exit survey tells us and people that churn tell us is that for that price, we still have the right features. So that is indeed the learning that we're taking on anyway, we're taking on and we're adding features all the time. So the next question is quite similar. You report 697 paying users but only 344 active. Does that mean that roughly half have canceled? Could you break down gross adds, churn and net growth? And do you see patterns? We're not going to give any further numbers out. Most of it can be done through triangulation of numbers, I think. But we are a company that has given quite a few numbers today. I know it's never enough. But the thing is we're giving far more information now than any other company that would do in a similar stage of development. As I mentioned before, behind closed doors in California. So remember, the numbers that we give out also go directly to our competitors. So it's always good to remember that when we're being asked the numbers. It's not just in a closed environment, unfortunately. But yes, indeed, as I said, the exit survey always points generally to the same thing. When we have more features realeased, we will sell. You spite missing features, captions, animated graphics mobile uploads [indiscernible] cancellations, which of these are the highest priority to deliver? And what is your timing for closing these gaps? How will you prioritize given limited resources? Sumit Rai: Well, [indiscernible] available, captions are [indiscernible]. Ian McDonough: Okay. I think the next question is about product as well which is you have emphasized that collaboration is a key differentiator for Elevate. What is the average number of active users per paid account? And are most paid users solo part of multi-seat teams? Any information you can? I mean there's improvement but. Sumit Rai: Yes, we're not publishing the number at all. What we have seen is that as we've increased the amount of seats that users or team is able to have, we're seeing further collaboration. The review user has brought in more collaboration as well. And again, because there's a lot of misunderstanding about this, that video editing traditionally is not a very collaborative process. We know that. That's why we're building a collaboration version of it. So much like producing a print brochure 20 years ago was left to a designer and then an art-worker and then it went to the printer. It's a very linear process and video is the same. We're doing the same with what we're doing. So we expect collaboration to grow as the product grows and the market grows for this and it becomes more available. And I think the previous question actually was slightly different than just product market fit. It was a little bit about the paid users. So it was, thanks for the update on the space. You're telling us what potential paid users could do know a little more about what it is that's coming in order to in the future of the product, why are you not telling people, more people about what's coming. Now that's a very fair comment. We've actually been discussing this recently. We used to run a podcast at the beginning where we did discuss things like [indiscernible]. We're bringing that back into some format. We're not exactly sure of the exact format of it, but we expect in the next few weeks to see a new format where it is more updates from me, [indiscernible], the engineering team and things that will be hinting at what is coming. And more importantly, not every one of you, especially as investors uses the product. So you don't necessarily know some of the wonders that have happened, like the feeling of the new Boundary Boxes or how the looks are working. You just maybe hear about them in brochure, but it will be an opportunity for you to watch this and actually see them in action and obviously discussing maybe some up and coming things. We're definitely going to keen to do that and look after our user base. Ian McDonough: Thanks Sumit. Question statement, pricing strategy, keeping the early discount longer could have brought goodwill while the product matured. Yes. Thank you. That's a very good point. And to the point I made just slightly earlier is that we are in a learning phase, and therefore, we thought it was valuable to learn about how our product will be received at full price. But again, yes, I do think that's an interesting point. You featured a meeting with Boris FX, if you want to go on LinkedIn. Is there anything you can share on that? Sumit Rai: Nothing to share other than we are obviously in constant conversations with Boris FX. Ian McDonough: And how we utilize. Sumit Rai: Yes, absolutely. Ian McDonough: According to respective AFN members, adding mobile upload functionality to Elevate requires only a day of work for one person. Do you think that? Sumit Rai: Well, we don't compare. It didn't take one day, but the good news is today is the day and it is available. So please take a look at it and then reimagine whether that was one day's work. Ian McDonough: I have to say, yes, I think I would love to be able to take a finger around all these features just landing the product overnight. It will be amazing. You've got to remember that no one else has built what we built. And we built it in a very rapid amount of time. So yes, there is no global product like us. It's not easy. It's really not easy and the team are incredibly talented and incredibly working [indiscernible]. Thank you very much for that question. Ian, can you say a little more about the employee numbers and cutbacks that you mentioned in the interims, are features being delayed due to lack of developers? Yes. So we've really -- we are constantly being disciplined about cost. Cash is a concern for not just us, but every company in the world today, and we must be very disciplined about that. So we're reviewing, we review our teams all the time. I have to say that it's definitely not down to lack of developers that we are -- the products are arriving when they're arriving. I wouldn't say they're delayed at all. They're arriving when they're arriving and they're working at pace, and we have an exceptionally talented development team working on them. Great work from Kelly Kiara on the social videos. Give us off a round of applause, everybody loves you. Sumit Rai: Thank you. Ian McDonough: What do you consider to be your biggest threats to not realizing the amount of the TAM? I guess translating or not having enough marketing spend. Sumit Rai: That is a worry that not being able to communicate to the market with the effectiveness that some organizations may have. I'd say that's probably a threat to us. Ian McDonough: And the fact that not being able to explain the benefits of the product to a wider audience. And yes, that's true. As I said at the beginning, it's not a risk reinvestment. It's a potentially huge return. Sumit Rai: Another one is the biggest threat to us not being able to realize a large amount of TAM if we go down a [indiscernible] angle. So if we build a product like most of the online products that are available today in this space. Remember, we still see ourselves as the only professional grade product in the space. Most of the players in this space have gone down very, very narrow, very limited market. That market, there's -- all of them are in it. So they've not only taken a very small, a little or [indiscernible] the large part of the market, but a very unwilling to pay part of the market, and then they divide themselves amongst themselves. So what we must do is say, right, let's just focus on this one thing over here. That would be a threat to us if we're forced, we force ourselves but we're forced into that space. All we're doing is limiting ourself for the onset. Ian McDonough: Just to check over the question. I'm on question 36. How will you fund the business over the next few years given the small net new customer growth and the high cash burn without massively diluting your loyal and long-term shareholders given the share price of 1.9p and the market cap is sub 10 million. I think the key thing there is that we're building a revenue engine. And a revenue engine has to be profitable. You need to put one, you put a pound in and you get more than a pound out, it's profitable. If we can show that revenue engine working or we can show massive improvement towards that revenue engine working, then we have an investment case that we think is sound. We think we have visionary investors here and other places that will back that given the huge amount of opportunity there is in this [app]. So that's how we'll do it. Sumit Rai: Can I ask the one about [indiscernible]. Ian McDonough: Good question. So according to technically a member, Elevate is a light version of the software you already developed Blackbird, so why are you taking so long? And could you develop Elevate from scratch in a few weeks? Sumit Rai: So the answer is no, you couldn't have developed Elevate from scratch in a few weeks. Blackbird is actually a different product in a different market, although the technology has been applied directly to Elevate. And there's quite a lot of technology that hasn't yet been applied in Elevate that we'll be rolling out over time. So the key difference, if you think of it from a practical point of view, is that often in the Blackbird editor, you take 3 months to install it and [Whitebird] treatment to train people up. With Elevate, you can just come to the website and the feedback I've had from a lot of people is they can just sit down and use it. And so it's like a different audience and a different market and different level of support. It is a new product. But it has actually been accelerated a lot because all the Internet side of the technology has been ready made. And now we're moving on to GPUs. There's obviously synergy between the different parts, the different editors. In fact a lot of the work we've done is synergy between them for the new development. But the Elevate is actually a masterpiece in beautiful design and that reflects a different audience from focusing entirely on efficiency and people get paid to do it or they don't get a job versus creators who actually have aesthetic sense and they want a beautiful product as well as beautiful functionality. Ian McDonough: It will be fair to say that packaging is also completely different. One is on premise installation and [indiscernible] process. The other is something that scales in the cloud and in a different market. The heart and the core compositing is absolutely identical. In fact, innovation sometimes that elevate drives end up back in Blackbird and vice versa. But also the truth is it's taken many years to develop the Blackbird product as well. So it's not something that wasn't built overnight, so there's no reason to elevate. But the heart of both products is absolutely the same. The packaging of them is different. It's like [indiscernible]. All right. Next question. Cal, you've made many short videos aimed at beginners. Are beginners a key part of the marketing reach. Sumit Rai: Yes. So beginner and by the way, a credit to Kiara as well, who's been making a lot of videos and doing an amazing job, not just me. Yes. I think beginners are definitely a big part of it because elevate is being built to be a super intuitive, super easily accessible video editor. So we want to introduce elevate to beginners because it's so easy for them to get into it. And it's kind of like linking back to the Uber TAM story that Ian mentioned earlier, people that would have otherwise never -- video editors because the current offerings are just way too complicated, require heavy machinery. They are giving video editing a shot now because elevate is making it so accessible and so easy for them to get started. So yes, beginners are definitely going to be very important for us. Ian McDonough: Thanks [indiscernible]. Do you see the instant review tool as a way to help the virality of elevate.io? Sumit Rai: Yes. Definitely, it's the way in which people will -- their first touch will probably be for the foreseeable future, the most likely way that you'll use Elevate for the first time will be as a reviewer. We definitely know that, that will be part of our viral flywheel, and it's a great way to get it into people's hands. Frame io had exactly that same experience. Most people's Frame io experience started with receiving a link and being able to review something. So yes, it's a big part of our strategy. Ian McDonough: Will you need further funds to the scale-up phase? Our ambitions are topic. Our missions are industry changing. And yes, we will need more funds in the scale-up phase, but we will be taking our revenue engine to the market for that revenue phase for that scale-up phase. How often will you be communicating the update of your leading indicators to shareholders and investors monthly question mark. I think we'll be taking our leading indicators to you guys when we have the end of year results and other moments [indiscernible] like the AGM. As I said, every time we release numbers in the market, they go directly into the dynamic and exciting market that there is here and to our competitors. So we must be careful about how often we release all these numbers. Will any of you be adding to your shareholders at current record bargain base share prices with you clearly being very confident in the future. Also great to see the adverts. They look really sharp and really demonstrate elevate and its use. Well, as you know, we are big supporters of this company where all of us around the table here investing almost to our max in terms of how we can support the company. It is a bargain base price. And if we have funds available, then I'm sure we'll be investing in this exciting time and thank you very much for that. Sumit Rai: I don't mind saying that I obviously don't have to declare I'm not a Board member, but I believe I was the largest trade buying trade on Monday, and under 2p, it's -- when we talk about shareholder value, we'll judge whether 2p was good shareholder value in the future. To be clear, sorry, we only get the opportunity to buy stock at like 10 days a year. So we get limited opportunity. So the opportunity is there for us at the moment and that's great. Ian McDonough: Question from Jimmy Louie. I searched the Internet to ascertain the opinions. And what I have seen the opinions are good I'm personally in support of your aims. Thank you, Jimmy. When will elevate be finally ready finished and beautiful. I love the finished part. Sumit Rai: [indiscernible] behind it. It's an ongoing product. Already, it feels a lot more finished than it did 6 months ago. Those of you who use the product will know how much the last 2 months have meant in terms of its development, in terms of maturity. So we expect that certainly by the end of the product market fit phase, we're going to be in a great position. But even by the end of this year, I think people will be pleasantly surprised at how good it's getting. And that's the feedback we get from a lot of users and a lot of the different focus groups that we remained constant from the beginning of this project, the feedback has been phenomenal in terms of progress. Ian McDonough: Please describe the play and what to do or [indiscernible]. Sumit Rai: Yes. Quick publish beta is how it's going to be built on the menu. What that allows you to do is a published video of any length in almost no time, in seconds. And it creates a web page with a link and you can share the web page and it also gives you feedback on how many views you have and allows you to clip out the best bits and we share those. So it's a very easy way to distribute your content externally without having to do a render and people downloading and uploading stuff. And obviously, it's very useful for development because we can put the new technology in and roll it out to thousands of people and see what works or what doesn't work. Ian McDonough: Yes, [indiscernible]. Sumit Rai: Yes. So that's why we've limited it so far. And it will be hard to find, but it will be available to everyone in a few weeks. Ian McDonough: You've spoken for some time about the uniqueness and strength of Blackbird technology and now elevate.io Given that there has been no major strategic partner or Keystone customer who's really wanted to lean in and commit to being part of this journey. Do you want to look for this type of strategic involvement? Certainly, in terms of the partner, we are doing the development and roll out ourselves. In terms of the customer, I think that's absolutely something that we touched on. Sumit Rai: Collaborations we're working with organizations in collaboration with them to not only learn deeply about them, but to co-share marketing activities, which is great exposure for both organizations. Ian McDonough: Question 51. elevate is amazing. Thank you all. SBS. I imagine if you wanted to, you could put your feet up and do whatever you want in life. Sumit Rai: What do you want to do? Ian McDonough: What motivates you to develop elevate and what are your ambitions forward? Sumit Rai: Well, it's very rare you get a chance to change. And right back at the beginning, I invented cloud video editing, but the market was very small. In fact, everyone has always been saying we were too early. But now we've actually got a massive market front billions of billions. And with some [indiscernible] products actually making the tool that meets that need. So I'm very happy to supply the technology for that product. Ian McDonough: Thank you, Stephen, and thank you. How close are you to releasing AI captions capability? Sumit Rai: By the end of the year. it could be sooner. We absolutely keen and I released [indiscernible] future tech that's probably the first to market, and sometimes it's not just a race to be first, you've got to do it well because no one implementation of captioning, we feel is good enough for the kind of editor that we're building. So we are doing quite a -- we're doing a good implementation of it. We want to make it so that it really does work to scale, not only for people who just want to capture a small Instagram post, but also somebody who would use it to capture a 2-hour documentary. And we are going to -- the plans for it are going to be very -- going to mean it's to be a very good implementation. Ian McDonough: And yes, we absolutely know that's fundamental. It's fundamental to expected running of this product. And so we're really focused on it. Statement here, well done on your amazing innovation and total determination. Thank you very much, Philip. Given that next, the next results are 6 months down the road, are you going to give shareholders update on numbers before then? I'll refer back to my answer a few minutes ago, which is these numbers go direct to the competition, and we give out far more numbers than any of our competition do. So I would like to say that probably not. We are going to be doing our [indiscernible]. I'm a professional tax and business adviser. As a consequence, I come across different trades and professions. I'm in favor of initial face-to-face workshops. However, once there's been a minimal level of learning in future, I will consider online updates. How would elevate.io fit in with a live online meeting? Do you want to answer this one? Sumit Rai: Sure, yes. So yes, we also really, really understand and see the value of face-to-face, especially at the stage that we're at now where we're building our initial customer base. So the -- a few of our initiatives in the last couple of weeks and months have really demonstrated that. So for instance, the events play a big part in this. We've gone to events, and we've been demoing Elevate to so many different people and so many different teams, showing them exactly what's so special about it, how to use it. And that's been really, really effective. It's our first real play at like really just face-to-face, almost white glove type of initiatives. And the reception has just been absolutely incredible. It's been so validating talking to people. And what we've seen coming out of those is that it's very effective in generating leads and actually onboarding people onto the platform. So 100%, we're going to -- we're doing a lot of education. We had our first play at the webinar yesterday, as you know, that's going to improve and develop, and we're going to teach people how to use elevate at this point in time. We're a lean marketing team. But at this point in time, we can really do that. And it's all about educating people, showing them how to get onboard and showing them how to make videos. Ian McDonough: Thanks Cal. So, a question on EVS. Steve [indiscernible]. Stephen White: Yes. Any update on EVS? Well, there's 2 sides actually to EVS. We did announce in the RNS as well that we have actually been included as part of their offering for the winter games in 2026. So that will happen in Italy early next year. The second side to it is the technology licensing deal. And all I can say at this stage is, yes, EVS have been rolling out [IP] via Create to other customers. But at the moment, we are not in excess of our annual minimum guarantee. But when we are, then we'll let you know. Ian McDonough: Thanks, Sumit. Ian, you're targeting the U.S. East Coast. Do you have enough people out there to achieve your ambitions? Will you go there to start to push the product? I mean I would say at this stage that we are targeting the East Coast in terms of customers, in terms of [indiscernible]. And yes, we have enough people there to do that. Will I go out there personally? Well, I don't think I need to at this stage, but I was certainly visiting the U.S., I would think in the next few months for different reasons, and I would think very possibly to go to the East Coast. But we have someone on the ground in New York already, and we [indiscernible] on people when necessary when we're doing events. So yes, we have -- we're happy with our team presence over there currently. What is your target for paying users at the end of the product market at this stage? I think this is more about momentum. This is more about engagement and about retention and about conversion into paying users as opposed to absolute numbers. We will know when that stage is reached and it will be very much a case of selling that revenue engine at that particular point in time. Which month will product market fit actually be complete? Sumit Rai: Yes, I think on the scale, it shows towards the end of February 2026. But again, we -- it's not -- you don't set the date in the diary, it just [indiscernible] what happens. We will produce a bit more guidance obviously around the time and be clear about it. And it also doesn't mean that there is physically a day. I mean it will be a period where we say, okay, this is complete and we're moving forward. Ian McDonough: When you take on users, do you request data such as student filmmaker charge, et cetera? Maybe you want to build out on this one, [indiscernible]. Sumit Rai: Absolutely, yes. So we have an onboarding survey, and we've had that since the beginning of this year. So we've had that for quite a while. And we have a lot of data about our users, what kind of profile they have, what kind of skill level, what kind of videos they're making and that data has been very valuable, and we use it all the time when we do our analysis. And in addition to that, we also have our access survey. So also when people decide to leave, we also collect data and ask them why. So it's all about learning. It's learning through quantitative data, but also very much through qualitative data. So yes, we're absolutely doing that. Ian McDonough: Question for Sumit. Will we be able to store our projects in a folder in the near future? And will we be able to duplicate our projects in [indiscernible] copy. Sumit Rai: Yes. So Team folders comes out today, project being able to access the T media from a project within the media interface is going to trail slightly later and duplicate project is almost ready to go and is obviously a key part of a few things, one of which will be multiple sequences and then being able to have demo projects, which is also tied in to duplicate project. So lots of things in that space coming. Ian McDonough: I love the next question. When the marketplace is up and running, will there be a merch store so we can purchase those shirts? Great presentation update, confidence restored. Thank you very much, quite happy to hear it, to hear that. Yes, I think not our top priority, obviously, but why not? Cal, any chance you can make a video of a gorgeous setting, just price of a volcano eruption, then post it on your YouTube channel [indiscernible] with elevate advertising course. Sumit Rai: That is a really good idea. I could have come up with that. We need to do that. We need to do that. We'll scout out locations starting tomorrow. Ian McDonough: I sometimes think investors don't worry about how complex a development this can be. Perhaps you communicate to investors this is very hard. I think the podcast is going to go a long way to explaining the problems that we're solving, right? That's [indiscernible]. Sumit Rai: Yes. I mean the good news is that the development team who have obviously the core team from Blackbird who've been working on the core engine for a long, long time. But a lot of the people who worked on elevate have only been working for 3 years, including myself. And the one thing that we're very confident about and that we have achieved within the product market fit stage is that we now know how to do everything that we need to know. This, at least for the foreseeable future. There will, of course, be challenges that come down the road when we -- our ambitions widen. But we're very, very confident. But you have to remember, at the beginning of this, we had an idea of how, for example, multiplayer and the multiple courses of conflict resolution would work. We were sure of it that we know it can be done because of adjacent industries, but could be done on the video time line. All of the really important things that we didn't -- we may have had confidence in, but we didn't have the full answer to, we have achieved as part of the space that we're in at the moment. We -- everything we have been scared about has being solved and is working. So now we just have a lot of execution work and tidy up work to get to there and then into scale up and then the process will begin again and then we'll set our ambitions higher and have to go and solve more problems. But the efficiency of the team is absolutely true. And also that their understanding 3 years is some of them less than 3 years and some of them are one of our developers has only been with us a few weeks and already been responsible for the in and out points and the preview player that's been the first piece of work all achieved within -- certainly within the last month. And what's important is that the knowledge within the organization, within the development team of what is the right thing to do is now becoming second nature. And that's really important because this is not a trivial subject. It is a very detailed subject. It's stoked with legacy. It's got nuances that you wouldn't believe. And that's just very obvious, by the way, when you look at the other online video providers, some of the other online competitors, you can tell that they have not understood the video production process because of the way that they've done certain things. And for us, that team is really gelling. Ian McDonough: Excellent. When would you need your next cash injection, especially as you realize marketing is critical to realizing a large amount of TAM. Again, we answered a little bit earlier where we will be needing cash to scale up, of course, and we will be taking a revenue engine investment case to investors to do that. I think when we can show that fast improvement to the put a pound in and get a profit out, then we have a sound investment case to get to the new investment. Do you have any IP that protects your product from replication? Sumit, maybe you want to take one? Sumit Rai: Yes, we have quite a few patents for the technology, mostly the compression technology also makes the system very efficient on data as well as responsive and smooth. So yes, we have quite a few there. Ian McDonough: Question 69. If your new customer growth continues to underwhelm, how will you fund the business? It's easy to detail how you fund the business if everything goes as planned, but with the share price of 1.9, what are the options if slower growth happens. To answer your question, quite frankly, is that we are in an area where we have a huge potential opportunity to provide a return. It is not a risk-free investment. And it might not work. But at this point in time, we've derisked this product to an enormous amount versus where we were 6 months ago when we last spoke to you and certainly 2 years ago when we bought this plan to you. So I would say that we're in a fantastic opportunity to deliver versus where we were. But as I said, it's still not risk-free. Statements. Sumit, we love you and [indiscernible]. So how are we getting the message out that one of the things that elevate apart from the seeming competitors is it's so much more robust and able to do more short videos. I haven't seen this in the market messages. Over to you, Cal. Unknown Executive: Yes. So how do we get that message across? We get that message across through several different channels, right? You can't just use one channel to say something one time and then expect everybody to learn about that. I do think we speak about that. We talk about that on the website. We talked about that on our blogs. We make YouTube videos where we show how you can create longer-form content, not just vertical shorts on TikTok or anything like that. So if you're just following our Instagram, then that might give that impression that we're focusing on the shorts, but that's just because we're targeting the users on Instagram. If you're looking at our YouTube videos, it's quite a different story. We are showing landscape videos, longer types of formats. So yes, we will continue doing that. We always talk about how incredibly responsive elevate is versus other offerings, and that's really what sets us apart. We're a serious tool that works in the browser. Ian McDonough: No statements, it looks like the presentation has gone down well. The stock price is up. Well, thank you very much. And so it should be [indiscernible] a broader market. So I'm really pleased that we managed to explain it a little bit. I can't emphasize enough how important the Q&A is to us. Thank you so much for taking the time to speak with us. Very welcome. And yes, I think it's really important because it's not an easy thing to understand sometimes, as Simon said from [indiscernible] and other announcements. So it's really good to be able to talk to you directly. How many paid users are now needed to break even at the current cash burn? And do you have enough for paid users by mid to end of next year? I'd love to be to keep asking you for numbers. I'm not going to give any more numbers out than we have done. We give a lot more out than other companies our stage of development. So I hope you bear with us, and we'll release them when we think is the appropriate time. Share price up 0.25p since your presentation started, maybe a daily presentation work could work wonders. Thank you, Phillip [indiscernible]. Okay. I'm now going to go to question 76, which I think might be the last question. Is the plan to scale and then sell elevate or not? No plans to sell at this stage. We're a listed business, and therefore, we would love to enjoy the growth and rewards that come with being on the market as we grow. But no plans at all to sell the business. Thank you. Anything else anyone would like to add? Operator: If I may just jump back in there. Thank you very much, guys, for being of your time and addressing all of those questions that came in from investors this morning. And of course, if there are any further questions that do come through, we'll make these available to you afterwards. But Ian, perhaps before, as usual, just really now looking to redirect those on the call to provide you their feedback, which I know is particularly important to yourself and the company. If I could please just ask you for some closing comments, that would be great. Ian McDonough: Yes. Thank you very much, Jake. I mean I would say that's a very engaged session, and thank you very much for all your questions. We don't think this -- we don't underestimate how engaged you are. We know how important you are to our development. So it's a huge pleasure to be able to talk to you on these occasions. I will just finish by saying that I've never been more confident, more confident in the fact that we've got the right vision. We've got the right product. We've got the right timing, and we've got a huge global opportunity. So I hope you enjoy the light with us. Thank you very much. Operator: Perfect, Ian. That's great. And thank you all once again for updating investors this morning. Could I please ask investors not to close this session as you will now be automatically redirected for the opportunity to provide your feedback in order the management team can better understand your views and expectations. This will only take a few moments to complete, but I'm sure it will be greatly valued by the company. On behalf of the management team of Blackbird plc, we would like to thank you for attending today's presentation. That now concludes today's session. So good afternoon to you.
Operator: Good morning, ladies and gentlemen, and welcome to the Blackbird plc interim results investor presentation. [Operator Instructions] Before we begin, we would just like to submit the following poll. And if you could give that your kind attention, I'm sure the company would be most grateful. And I would now like to hand you over to the team from Blackbird plc. Ian, good morning, sir. Ian McDonough: Good morning. And ladies and gentlemen, thank you very much for joining this morning for Blackbird plc's interim results presentation. Today, we're going to take you through a lot of information. We're going to take you through product strategy, marketing strategy, talking to our early metrics and talk about what happens next. And of course, as always, have an extensive Q&A session. Before we start, I want to talk about one particular thing, which is where we are in the journey. We are on product market fit stage, and we've talked about this when we came in June and also back earlier in March. In our product market fit stage, we are learning. We are delivering features, still very basic features, actually, and we're learning from that data. We are not in our scale-up phase at the present time. Our product market fit stage is going to run into 2026 and it's at that point, that we will move into our scale-up phase. What's interesting about the product market fit phase from our perspective and from your perspective is that it's generally done, 99.99% at times in a private environment with VC-backed companies generally on the West Coast of the U.S.A. This is a very different scenario. This is a public company, that is taking place in the U.K. And as such, it's a rarity. It's an outlier. It's a possibility for us also to invest in something that is really potentially very, very special. I don't see Blackbird and elevate as part of Blackbird as being a 10 bag or a 100 bag. This is potentially an enormous return. This could be 1,000 plus bagger. And I think in that respect, it does come with risk and it does come with patience. If nothing is nailed on in this, and we'll do something that is ambitious and potentially industry-defining industry changing. So please make no mistake about what we are trying to achieve. But we are very close now in terms of our developments, certainly in terms of the length of time this company has been around to reaching that growth period to reach an ultimate growth period. So I think that I would finish my introduction by saying I have been meeting a lot of actual potential users recently. There are people who are working in teams that are people are making -- responsible for video on a day-to-day basis. And I've never been more confident that we have the right vision to elevate that we have the right product to elevate. Do we have the right timing to elevate to deliver into a huge global addressable market? So with that, I'm going to start the presentation and now I move on to the first slide. Sumit and I are going to be presenting today. I think you almost know him very well. He is our Chief Product Officer, and indeed responsible for a great deal of the vision that you are experiencing with elevate. Now we are starting a revolution. We are starting a co-creation revolution. This is something that we've identified with our ICP, which is founders, entrepreneurs and small businesses but by their very definition, they are working in teams. They are co-creating. But right now, there is no workflow that is anything other than a slightly archaic linear format where they're frustrated by this on a day-to-day basis. And just to give you an idea about the scale of that ICP in the North America alone are well over 40 million small or medium sized businesses and that's without the rest of the world being thrown in. So it's a huge potential market. And let's share a few words from recent events we've attended in the U.K. [Presentation] Ian McDonough: Right. So obviously, [ I've lost a day ] there in Hertfordshire where we went a couple of weeks ago, but really rewarding to hear the feedback on people's first impression of elevate. It's got better since then where we gone through marketing events in the last few weeks where our people are, again, as I say, using collaborative processes on a day-to-day basis but have nothing that really satisfies their needs. So on the slide here, we've plotted our product road map on the lower axis there against the potential growth that we see, the growth that we're looking to deliver. This is really a guide to where we are today, which is pretty much halfway through our product market fit phase where features are delivering at pace and Sumit has some exciting news on that to talk to you about in a few minute's time to really take us to the next page, which, of course, is scale up into 2026. So some early leading indicators. Well, so I've got quite a few different range of numbers here. The first one is on -- in terms of sign-up users. We've got 110,000 signed up users now to elevate. This really shows that there is a problem in the market that we're looking -- that we are there to solve, right? It doesn't necessarily mean that we have to put the solution yet, but it certainly means there is a problem solution fit. In terms of conversions, we now converted almost 700 people into being paid subscribers. As you can see on the next number in terms of retaining those subscribers, then churn is suddenly a focus for us. Churn is something that we are already making sure that we address and that is mainly through new features, and features that are being delivered on a rapid basis, but also through alignment to our ICP and almost also to engaging those users along the way. Now we could have spent more money in the last few months on making sure that when we came to you this time that we had a high number of current paid subscribers, but it wouldn't have been money well spent, we're really now focused as a business on making sure that we're delivering the right features at the right time to improve that churn number to make sure that we are going to be spending the money the correct way. We've got 1,450 returning users in August, which gives us a really nice trickle of users to make sure that we have enough data to make sure our features are running well. And since launch, we've had an 81% increase in engagement. So that means that people that have come meet the product have ended up exporting a video at the end of it. So again, it is a really good idea that we are improving all the time with our features. And what we've done now is really trying to line up more with our ICP. Again, the ICP, just to remind us, is those founders, entrepreneurs, small businesses and small marketing teams that are a larger number and engaging those guys to use elevate on a day-to-day basis. A few -- a brief look at some financial metrics. We've had some quite good improvements here. We've had a 21% improvement in cash management over the year. So that is down to GBP 1.5 million in the half. We've had GBP 600,000 worth of revenue come in. It's slightly down on the Blackbird side. This is mainly due to some [ ideal ] losses, but also the non-repeating transaction happened in half 1, 2024. But the positive news is that Blackbird is now EBITDA positive in H1 for the first time. We also did a small top-up raise to take us through the product market fit stage over the summer of GBP 2.1 million gross proceeds. I'll now show you a short video, which is a rough cut of a YouTube video that will be released shortly, showing how elevate is a collaborative feature -- a collaborative platform for marketing teams and social media teams. [Presentation] Ian McDonough: Excellent. So also got a sneak preview there on our first partnership and collaboration, which is with the London Cavaliers so more used to come over that over the next few months. So why is elevate needed? Why is elevate required? Yes, it's very simple to use, and that's a huge benefit to the people. And yes, it allows complete freedom to operate from the browser, which gives access and freedom of movements. But the most important thing is it's collaborative features. Collaboration is not just at a niche part of the way teams work. Collaboration by definition is exactly how teams work. And it's not just a multiplayer aspect of our platform either which is, of course, the [ jewel of crown ] that separates us out from really everything else. But the fact is that we have this incredible access to assets as well. So we can manage assets. We give immediate access to teams assets. There is no upload and download. And of course, there's instant review, which we just launched in the last couple of weeks and of course, the leaving of comments about asynchronous collaboration. So it's a much larger part of the workflow, they're just purely the multiplayer, but the multiplayer really does differentiate us from any other editing platform. But the integration with everything in the back end as well is hugely, hugely important. Now why us? This is the investment case really. Why would you invest in Blackbird plc because we have elevate? Well, first of all, we have the technology, and you've heard about the technology many times. This allow us for a fast manipulation of content under low bandwidth conditions in a browser, and that is completely game-changing compared to any other platform out there. And it's given us a massive head start in terms of just how we've managed to develop elevate and have it in the market. We've heard that many times before. I just want to focus on team for a second. Team -- I've never worked in the team that is as talented or as efficient as the team I currently work in. And that goes from everyone from Sumit and his product team to the development team to our marketing teams, they are exceptional, and we are really -- we're very lucky to have selected such an amazing group of people. And we are very active in making sure that we keep those people at the very best levels. And the other thing that is really important to mention here is TAM. As I mentioned at the very, very start, we've got a huge global addressable markets. And this global addressable market is not just video editors, this global addressable market is all the people that work with video. I saw an interesting anecdote recently about Uber is when Uber presented their initial investment deck. They estimated their TAM to be the entire taxi market of the world. But they got it wrong. They were out by factor of 8. It was 8 times bigger than that. Because before Uber, people didn't take taxis, it was too difficult. They took taxis once or twice a month, and now they take taxis two or three months a week. It's a huge, huge different proposition because it meant -- Uber made it so easily. Figma had the same situation. Figma have a channel that was very small when they first launched because no one has designer software unless that you were a designer. Now every one of the company has access to Figma because it's so easy to use, and you can review and approve and you can input on the design as the process goes along. Elevate is very similar. So when people came to us over the last few weeks and said, yes, we have one or two Adobe licenses in the company and then people send me the exports of products, I write back my feedback on e-mail, and that's how it works. Elevate will be entirely different. Elevate will be -- they will have access to that video directly, they will be a customer of ours, and therefore, our TAM is many times larger in fact, than the global video market today. It gives you a bit an idea about TAM -- about the investment case, right... Sumit Rai: Hi, everybody. And so when it comes to products, I think I want to you on a little bit of a journey of where we started the product market phase where we are today and where we're going. So if we cast our eyes back to February when we actually put in the gateway and we sort of went out into the market. What we had put together was essentially an editing and collaboration capability. It was so crucial for us to get the collaboration elements built into the product early on. There's no way they can be added later and it's such a fundamental part of what we do. And this is something that people are only just beginning to understand is the importance of collaboration in the elevate story. If we were just building a video editor that was just trying to compete functionally with the desktop tools, we would have not much of a future because we'd be fighting against incumbent and we'd just be able to do what they can do, but they can already do it. What was so important for us to acknowledge that just like lots of other adjacent industries in design, in 3D, in accounting, in CAD and general marketing, products have come about that actually enable teams to work together to achieve something. That doesn't mean that everyone becomes Ridley Scott overnight. It doesn't mean that everyone is going to become a colorist, but what it does mean is that they can get involved in the process. So we put in place, as we launched what was not hugely available to everybody was a lot of that collaboration infrastructure. What we were light on and we were well aware of this was the general editing capabilities in the way effects. Our media management was very, very lightweight. Processing was -- we're lucky that we've obviously got the infrastructure and the experience from the original Blackbird product to help us. But that was also limited to a bit of a broadcast model, whereas we operate obviously in a much broader model. So we went to market with what we knew was the foundation of what we did. During that product market phase section that we're in at the moment, we've learned an awful amount from our users. The telemetrics that we have in the product tells us how people are using it. They tell us when they're using it, they tell us to what extent they use it, and it shows up where there are problems or misunderstandings in how the product works. For us, right now, the value comes from having small clusters of users in these customers, which gives us a really good indication of how it works in education or how it worked to finance or how it works over here. What we don't need is 10,000 users in each one of those sections. We get more than enough from the users that we have that are free users and of course, the paying users, which we can learn a lot more from because when you're paying for something, your behavior tends to be slightly different towards it. So when we've arrived at today, based on all the information we've understood, we've increased the collaboration capabilities, the recently released review mode has been incredibly -- has gone down incredibly well with users, we've increased some of the editing. What we've made a big move forward is on media management. As we know, we're not just building an editing tool, we're building a collaboration tool, editing and media management and we obviously have future plans for other things, too. But the media management is something that is almost impossibly done today. In fact, just earlier this week, we were with an analyst and their exact story was the hard drives for the projects that we get made for us just sit in someone's bedrooms stacking up over time. That was the exact words and you never see the active experience that we had from people. So we know that media management is an opportunity. It's a whole business in its own right. We are in our infancy of it, but we now have team folders within the projects themselves. And as of today, team folders will be released. So the entire team can have media management at the top level of the product, not just within each of the projects. Our effects and transitions, we have a lot of interesting things coming, but there's a lot of work that's happening behind the scenes that people won't have noticed. We've quite severely improved the way that the video editing is compositive within the product. And that's going to give us a lot of opportunity to use gaming technology to actually produce a much more advanced effects using the GPU on the computers, which is now becoming prevalent. This is incredibly important, especially for the low-end machines like Google Chrome. Of course, our accounts and payments were increasing the ability for us to manage people. It's also super important that we ensure that our way of managing our customers has done really well. During this period and up to this period of time, we had an unbelievably high availability. The system has been there. We've had minimal disruption. We've been able to identify where problems are lurking and we've been able to deal with them now before we have a much larger user base. So I'm incredibly happy with how this phase has gone. But of course, we're only halfway through the product market fit phase, and we've got a lot more to come. And this is where we see things moving when we get to the end of that phase. We will improve the collaboration further more, which we're really happy about. We will include more editing. You'll have noticed in the last week, we introduced fundamental editing tools like the preview in and out points. We've got a lot more of those to come. Our media management will be improved including things like search that you don't get in other products. And our effects and transitions are really going to come to life. Another area that was released just today and is only available as of about an hour ago, is the mobile upload capability. So anybody who now accesses -- from your phone, if you access to your elevate accounts, it will give you a web interface where you can upload content directly into a project or a team. We advise people share it to their home page, so they get the full experience of a progressive web app. And it's a great experience only at the beginning, we know that the mobile element will play a vital role in collaboration, and it will play a vital role going further forward in things like distribution. We're going to be improving our accounts and payments to incur different types of payment links as well as different types of accounts. And as I mentioned, our media processing will just improve further and further to cope with a much wider range of file formats. From an AI perspective, we've already introduced a very lightweight version of AI, but we've got lots of really exciting AI integrations with third-party companies coming. And that makes the beginning of our marketplace. It's only a small effort by the end of this, but it's going to be the thing that will be useful during the scale-up phase. Over to you. Ian McDonough: Great. Thanks, Sumit. So on the marketing side, our marketing, of course, will naturally trail product because it's really important that we are data-driven that we can see that the product is delivering on the feature side, which, as you can see, is rapidly happening with such really exciting news happening with us a few days and even this morning. So we -- our market story started with search, and we started with search last September. Search totally did bring in a large number of users. But search doesn't lead to engaged users. And we wanted to make sure that we have engaged users as we go through this product market fixation. So learning was always going to be a little bit limited from those guys. So where we are now, we've broadened our marketing strategy out to include events. So building awareness to our ICP directly through events and PR as well. If you want to see some stories come out about elevate over the last few weeks and indeed through organic social videos. So there's been a lot of work done in the background on that as well where you've seen our team deliver our videos to Instagram. And our Instagram views have gone past 100,000 now. We've got over 2,400 users followers on Instagram. So it really shows that there's an effort there to make sure people come and understand elevate that they understand what elevate can do, what it's for and on our message. And as features start to land, we'll build out this further, and we'll really start to unlock over the next few months as we go through the final market fit stage, access to much larger audiences, audiences that will be evolved through partnerships and through influencers and through referrals. And referrals, of course, will be the start of that product-led growth as well. So this will all happen over the next few months and through the back end of the markets fit stage. So in conclusion, I'm going to finish the same way that I finished my intro, which is over the last few weeks, we've met a lot of people who are directly interested in elevate.io. And I've never been more confident in the fact that we have the correct vision to elevate.io that we have the team that can deliver elevate.io and we have that ability to execute over the next few months. So thank you very much, Ladies and gentlemen. We will now take questions. Thank you. Sorry, we're going to finish with a video that shows the portability and the accessibility of elevate.io through another Youtube Ad. So one second... [Presentation] Operator: Perfect. If I may jump back in. Operator: [Operator Instructions] I'd just like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A can all be accessed via your investor dashboards. [Operator Instructions] And guys at this point, if I may just hand back to you to read out those questions and give your responses where appropriate. And if I pick up from you at the end, that would be great. Thank you. Ian McDonough: Thank you so much. Okay, I'll start and I'll read through the questions. First one is for Sumit. Can you please tell us what about your plans for the marketplace and the kinds of companies and services you are hoping to [indiscernible] in the early stages? Sumit Rai: So the good news is, is we've already begun work on the marketplace in the things like the AI services that we've implemented are essentially like the market that are using third-party services. We don't have to have other companies buildings. We can build certain marketplace items ourselves that interact with other companies. In this case, OpenAI has obviously been our first partner. However, we are working with very well-established media companies who make things like visual effects in terms of how do we actually bring some of their technology into us and make that available to others. So it will be in the workspace visual effect, it will be in the space of data provided, obviously, the AI providers. And of course, distribution. So going out to other platforms, YouTube for instance, and we can do that work ourselves. We don't have to have them do it. But yes, we'll obviously -- as soon as we had established, we do want to have more and more companies, we want to take [indiscernible] and build the things themselves. Ian McDonough: Excellent. Second question, I know Blackbird can help almost any type of team or creator, but having worked in creative agencies, it seems particularly ideal for that market. Have you considered positioning elevate as a video editor that's tailor-made for creative agencies? Sumit Rai: Yes, I wouldn't say that we want to tailor-make it for any specific industry itself but it is a great use case. And we do believe that the creative -- we're already beginning to see creative issues that companies that we're working with ourselves as a company, seeing the value of elevate, even the people who worked with us to put together some of the marketing assets, the video that you've just seen are instantly seeing the value of the product themselves and we've been using, obviously, to build out the content. So definitely, the creative industries are going to be a market that we're absolutely going to want to go for. And we believe that the way we're setting up the product means that creative agencies can much easier help organizations that have elevated results with some of the higher end work and things like that. So it's a definite industry that we want to be working with. Ian McDonough: It's a great observation. And again, it comes back to the collaboration point as well, which is creative agencies by definition, work in a team environment. whether it's just within their own team or whether it's with the clients. Some of the feedback that we've had over the last few weeks is that we've always talked about how elevate helps with speed and ease, it's more than that. It helps to make it bearable. I mean it's almost unbearable the way that the teams have to operate now today, whether that's uploading, downloading stuff and sending stuff like e-mail backwards or forwards. We've really thought about this process. Sumit's team and the product team have really thought about how this process should happen. What's the logical way this process, this workflow should happen? So yes, absolutely, creative teams are very much a part of our plan. We are delivering two ICPs where the features that we have today really resonates, and we will move towards creative agencies as we get further down the line. Question for Ian. During the IT presentation after the AGM in 2024, you stated, we want to build a company worth in the tens of billions. Today, are you more or less confident about that ambition and why? I mean I said it a couple times in the presentation, I'll say it again, I'm very, very confident. And the main reason that I feel confident is that on the product side and on the debt side, we've solved so many problems, we've created this product, it works beautifully. We are laying our features at pace and we are now in direct conversations with our ICP that are the people that will buy this product, the people that will use that product on a day-to-day basis, and they will talk about how this quarter works for them and grow the product there. So I've never been more confident about how this product and this company will grow. It is an excellent time, I have to say, a very exciting time. Question 4. My concern here is other tech companies are moving faster than us. We do not seem to be selling our product. And the sale side is failing because the product of the product developers -- failing the product developers. We are too slow. We are promised further news in September, which has not materialized. We need to update our information on the sales side to be more effective. I will revert back to the very first thing I said, which is we are in a product market fit phase. The product market fit phase allows us to be data-driven to make sure that we're developing the correct product at the right time for the market. We will scale-up in time, but we need to, at this point, get that product absolutely right. There is literally no point spending vast amounts of cash on a product that isn't ready for the market, to be scaled. Sumit Rai: If I can add to that, sorry, for a SaaS company to accelerate in the wrong direction is a guaranteed failure. If you put -- if you don't have these clusters formed and understand where the earliest success is and then accelerate into them, and you just go into the whole market, you can't boil the ocean. It won't work, there's a catalog of companies that tried that and have just burned through cash and failed miserably at the tail end of that. And a great number of successes with companies that have gone about it in the right way and therefore, found their areas then lead into when they go to the scale up phase. Ian McDonough: Excellent. Question 5. Could you give the current cash and short-term investment balance at the end of September? Stephen White: Whilst we can't give you that cash balance because we're in a closed forum, and that would require an RNS. What I can do is give you an indication. We had GBP 2.3 million of cash and short term investment at the end of June. We've all seen proceeds of just under GBP 2 million from the fund raise subsequent to that period. And in the last quarter as well, our cash flow was a six figure number, so I'll let you do the math. Ian McDonough: Thank you. Question 6, what's your goal for the product market fit stage in terms of users and MAUs and paying subscribers. The conversion of MAUs to payers has grown at 24%, while conversion sign-ups, 110,000 to MAUs so low, what precisely are you doing to address this metric? Well, our metrics really are going to be around engagement, around retention and around conversion. They are the key things that are really the leading indicators to whether that we'll make elevate a success. Yes, we agree that certain areas of the conversion are currently pretty healthy and some need focus. To answer the question about the 110,000 to conversions though, I will just pick up on that point, is that we started this in September 2024. We originally -- we were using our search budgets for a wide variety of markets, again, to learn, including India, including Philippines, and including other market. Where there wasn't a very high propensity to pay, but it was for data. And therefore, we wouldn't always expect those subs or those users to come back directly into pay subscribers. So there's a variety of reasons for different levels of conversion. I think we are at the point I would really have to leave you with is really about those leading indicators of retention of engagement and then conversion. Anything you'd like to add there, Sumit? Sumit Rai: I think to reiterate the point that, as you pointed out, the conversion of the regular free users that we get is low that we would be managed for us to do more of that at this stage. And again, find those clusters, and timing those early adopters is the goal of the product market fit phase and at the back of that, we'll not only have the products that is relevant to them and more, but we will have a deep understanding of those users. And that's what we lean into. Ian McDonough: Question 7. Why have we not released a player? Was advised as it was part of the overall elevate project, clearly, if we release the player by itself. In the past, many shareholders want it, maybe that would have increased the share of value as I understand the player would have been a successful tool that substantially increased revenues and share value. It's a double header for [ YouTube ] guys. Stephen Streater: Player, we've been using it and the technology in the player, we've pushed straight out and elevate once it's been tested, and we've been using the player as a testing tools for the technology. Because what we want to do is to get elevate to be really finished and beautiful before we start diversify too much. But what we have decided is that we will make the beta player available to all users so that people can try it, and there's quite a lot of technology coming down the pipeline that we will be able to test in the player. So I think you can expect for the user to want to do it, which is quite a few, they will have access to it but the key focus has to be to get the editing function working and then we will learn almost like product solution fit stage with the player, what sort of things people are looking forward there. Sumit Rai: You've also got to look at the order and the relevant buying order. The distribution capabilities of elevate are cream on the top of when where into the established market, they're not. We have to have that first, otherwise we're not going to have to users to warrant the use of the player. So right now, it's more important that the player is being used to build out the playback technology. The player division has pioneered the new way of compositing and the way that we're handling and working with things like the GPU, which will not only just help the editing process but will actually help the output -- the ultimate output. So it's a joint effort. And of course, the player is the testing bed for the new codec and the way we let things work in elevate. So we are -- it is happening, you just can't see it. But anytime you see a video playing back within elevate, you are looking at the player. Ian McDonough: Thanks, Sumit. Question 8. Can the company explain why it has failed shareholders so badly to allow the price to have dropped so far and what is the remedies to restore shareholder value? Can we please, from now on, have target dates but the company agrees with shareholders to meet. Sumit, can we have [indiscernible] the outstanding features, which the shareholders want so if go to the next stage, when will we meet the prosumer stage? Okay. So I'll take that, there's a quite a few different points in there. Why have we failed shareholders so badly? Well, I mentioned before, we're in the product market fit phase, right? We're putting out information fairly regularly and numbers too to explain where we are with that stage. And what that stage really means to you guys as investors, but also to the customers, which are also important to us. And it really is about delivering features on a rapid basis and leaning from those. Now in terms of when we are going to start delivering those features, Sumit, I know that they're coming thick and fast, do you want to take that part of the question? Sumit Rai: Yes, we -- the development process that we run through is an agile process where we make a release. It's a couple of times a week. It's just -- you don't always know about it because it's often things that are happening behind the scenes. And when there's obviously something notable, we do tell everybody and we -- the last couple of weeks, we've had a good cadence about one a week. Over the summer, things were slightly slower, but even before the summer, we were in the same process. It's really important that we don't rush junk out the door. The easiest place to kill our effort going forward is if we put products out if it's instable, not thought through and not good for users to use. We'll get absolutely nowhere. So whilst that might be frustrating from a shareholder point of view, it will only guarantee a further erosion of shareholder value if we actually are halfway -- 90% of the way through a bridge and it's the last 10%, well we'll just make it out of polystyrene, you can imagine what the outcome will be. So we're really going to stick to doing some things in the correct way because it's so important that we do the correct way for the users and if we do it the correct way for how our product will grow and have the future, just putting some in the market now that's under vision or not complete or incorrect with be catastrophic. Ian McDonough: I think to finish this question as well. This is where I take the visionary investor is that we've derisked this product enormously. So we started off with a PowerPoint document back in 2022 and have now come to a functioning product that has audiences that has customers all around the world and works better than any of the product that even comes close to trying to do what we're doing. It has been a fantastic achievement, on behalf of the teams have worked for us. I mean I'm really proud of where we got to. Unfortunately, the institutions or at least a couple of institutions haven't recognized that, haven't seen that, that is something of an achievement and haven't seen that derisk. A number of them have sold out and that has been damaging to the share price. I think this is where the visionary of investors, and I hope we've got quite a few of these on the call is that look at the share price now, look where we've got to, right? This is an absolutely -- it's a huge opportunity for people to get involved with the stock right now, I have to say. Because, yes, we've come as far and we've -- we are so much closer to be able to show that growth. And if you understand what we're saying, what's Sumit saying about where the products has got to then I'm sure that you'll understand the investment case. But yes, it's a shame that the rest of the market, certainly some of the institutions haven't seen that. Stephen Streater: We haven't seen them yet, let's say. Ian McDonough: Correct. What is our relationship with [ Avid ], rumors was we are doing a deal with them? No. [indiscernible] We're not in the [ Avid ] area at this stage. We're very much in the greater economy and [ Avid's ] not out there. For Blackbird ex elevate, the second half of 2024 EBITDA was [indiscernible] Stephen White: Yes. So for Blackbird elevate, the second half 2024 adjusted EBITDA was GBP 672,000 given a full year of GBP 490,000 is GBP 600,000 plus the expectation to second half adjusted EBITDA for Blackbird excluding elevate bringing it to 700,000 plus the -- plus for the full year after first half 1 of GBP 127,000. What I would say on that one is that yes, revenues year-on-year is not going to be the same neither is our cost base. We're not going to give our forecast by division at this stage. But as for the guidance that we gave in the RNS, we're expecting that Blackbird to be profitable for the second half of the year and the full year, too. Ian McDonough: Okay. Next question is finance question as well... Stephen White: Yes. The first half '25 [indiscernible] hasn't moved much at GBP 500,000 cases for 6 months. Can you break this down? Is this all salaries of how many people? It's principally the Board plus one other member, 80% of those costs are salaries and associated costs such as employers, national insurance. The other items in there are our cost being listed such as London Stock Exchange cost, or [ NAND ] costs, or audit cost, et cetera. Ian McDonough: One more finance question, please. Stephen White: Can you break down first half operating costs? Blackbird excluding elevate [indiscernible] have been halved, this all employee reduction. Yes, the vast majority is employee reduction on the Blackbird side, but also we have repurposed some of the team as our focus of reinvestment is on the elevate area. Ian McDonough: Okay. So a lot of questions here. So could keep the questions a little bit longer, please. So we'll get through these questions. So first one, my question on the definition of product market fit the capital efficiency. The company is investing heavily to build features for the highly competitive professional creator market, yet there appears to be a clear product market fit stage with existing products in the enterprise sector. For instance, large finance institutions like Lloyds or Barclays could immediately deploy this for internal trading. You need to rapidly create and share videos on everything from new software rollouts to critical compliance update. This market represents immediate multi-seat license revenue. So could the Board explain strategic decision to price as a cash intensive development rates over pursuing these large-scale enterprise contracts to be landed now and what is the sales team actively doing to penetrate this corporate market? Stephen White: Yes, so great question, really thought through, and let me give you some -- a little bit more clarity on something where you've said that we're targeting the higher-end creator market or [indiscernible] market. We're not. We've been quite clear that one of our big ICP is the enterprise sector. There is a slight difference in that you're quoting Barclays and Lloyds and we are more looking at the SMEs. And there's a very good reason for that because it may seem like, oh, we can just very easily deploy it there. Barclays and Lloyds are two companies I know very well. I've built their streaming infrastructure, I know exactly how you build video product within those organizations. And unfortunately, the procurement process to do that and the amount of hoops we have to jump through with organizations like that would not give us a quick-to-market ability to build revenue. We are more interested at the organizations that we've been meeting in the last two weeks at the technology and marketing forum and Ideas Fest organizations that can move very quickly. Barclays in Lloyds are absolutely our target at the right time. I know the people are, they've got auditorium, they have edit suites. I know the person who runs the video. So we absolutely want to be used in those organizations but getting in the -- as a cloud product, getting in and deployed within those organizations right now is actually something that would take longer. So we are going to be going to be focused on enterprise. We definitely see -- and this is very much the Figma story. Figma is promoted and loved by designers our freelancers and small agencies, but really they make their money out of Unilever. It's the 1,000 user -- sorry, the 1,000 customers they have that spend GBP 100,000 with them. That's our North Star. We definitely know that elevate, more than any other video editing products, will be able to scale into larger organizations and provide through their desktop editing capabilities. And it's a market, I know very well very passionate about, but not one you could just easily walk into. Ian McDonough: Excellent Next question. My question is on the definition of product market fit and capital efficiency. Also that was a -- [indiscernible] I have a process question based upon yesterday's Barclays Eagle Labs presentation, when a marketing presentation and engineering presentation delivered by the same person with a clear barrier between the two so much so they called it out after finishing their marketing element. The presenter was obviously an expert in the engineering details, that seems less comfortable delivering the marketing message, which is the first part. I would agree. Thank you for the question. And I would say that yesterday's presentation didn't meet our normal high standards of our product that we put to the market. I think we've all learned a little bit there. And it is an excellent presenter when it comes down to the, as you call it, engineering, but on the -- actually the editing side of it. But yes, we've learned that we certainly should have a two-handed approach to that and make sure there's a presenter that can deliver the marketing messages proficiently as well but thank you for the question. And I was hoping you could elaborate on the evolution of your growth strategy. The aggressive exponential growth curve that we outlined back in May appears to have shifted back towards a phase focus on achieving product market fit. Was this slowdown a deliberate strategic choice to prioritize product quality and user retention over share acquisition numbers? Was it more of a reaction to the market headwinds. And crucially, what milestones must be reached before the next one expect a return to exponential growth? Great question. And yes, there was obviously early signs of exponential growth, which is fantastic. What hit us with the churn and therefore, we've learned from that churn and make sure that the new subscribers coming aboard and the new users and subscribers coming board are engaged users that align to our ICP. So I'll reiterate the key things that we're looking for going forward in terms of those metrics. Our retention of those subscribers is engaging with those subscribers and conversion into pay. Those are the key areas that we're looking at. They're the lead indicators of what we're doing. And yes, it is an early phase. Sumit Rai: And I think that we could have continued the expenditure that we were making as such and continue driving through that, and we would have over 1,000 paid customers right now. We could have easily bought users. That doesn't help us. What helps us is we learn enough from the circa 350 that we have that are telling us and informing us about everything. We don't need 3x as many, that would have been too costly to acquire. What matters more is that as soon as we work with those 350, we'll you use the money we've got to acquire 2,000 rather than 1,000. So it really is about being disciplined and us pulling back where we needed to at the right moment rather than just for the sake of pushing a narrative that is still only in the hundreds, it would have been futile, it would have been. Ian McDonough: So a linked question there, Sumit. With around 50% of all paying users having churn, what level of retention uplift do you expect once the missing features like captioning and mobile uploads and graphics go live? And when will those features be fully released? Sumit Rai: Yes. So mobile upload, obviously just gone live. Captions has been very, very actively worked on, and we're hoping to see that by the end of the year. And we obviously are very -- well, there's a whole bunch of other features that are coming out especially in the graphics and animation space and transition space and there are others, by the way. And some of the graphs that show things, one of the biggest impactful things we've added recently was the Boundary Boxes. That was a very expected behavior that we wish we had sooner, and we've now put out there. All of these features, and we talked about quite a lot in the team recently, people come to us for the big features, but they stay for the little things. So just simple things like the folder management and relabeling things and some of those smaller features that we've neglected a little bit in favor of bringing in some of the bigger features. We now have a dedicated team that is going around ensuring that when people are in the product, they have everything they need. And churn is a result of them not being able to achieve what they need to do in the most convenient way and so we now have to work on the, okay, what is it we need to do to keep people on the products. We've learned a lot about bringing them in. What do we need to keep them in there? And what are the things that they absolutely need to get about doing their day-to-day. And how do we prioritize that. And like I said, we established a new team that is dedicated towards the smaller, more hygiene factor features that will help reduce that churn. And of course, in time, as we just had some of the bigger features that will also help reduce that. Ian McDonough: I think the other point as well about the number of paying users is when we reported back in May, we were at half-price. And we could've continued to go half price and see that conversion change. But we're in a learning phase. So when you double the price of a product, you're just buying a new metric, you're just buying a new standard. And of course, we're just now by standard of $15, GBP 15, EUR 15. And as the exit survey tells us and people that churn tell us is that for that price, we still have the right features. So that is indeed the learning that we're taking on anyway, we're taking on and we're adding features all the time. So the next question is quite similar. You report 697 paying users but only 344 active. Does that mean that roughly half have canceled? Could you break down gross adds, churn and net growth? And do you see patterns? We're not going to give any further numbers out. Most of it can be done through triangulation of numbers, I think. But we are a company that has given quite a few numbers today. I know it's never enough. But the thing is we're giving far more information now than any other company that would do in a similar stage of development. As I mentioned before, behind closed doors in California. So remember, the numbers that we give out also go directly to our competitors. So it's always good to remember that when we're being asked the numbers. It's not just in a closed environment, unfortunately. But yes, indeed, as I said, the exit survey always points generally to the same thing. When we have more features realeased, we will sell. You spite missing features, captions, animated graphics mobile uploads [indiscernible] cancellations, which of these are the highest priority to deliver? And what is your timing for closing these gaps? How will you prioritize given limited resources? Sumit Rai: Well, [indiscernible] available, captions are [indiscernible]. Ian McDonough: Okay. I think the next question is about product as well which is you have emphasized that collaboration is a key differentiator for Elevate. What is the average number of active users per paid account? And are most paid users solo part of multi-seat teams? Any information you can? I mean there's improvement but. Sumit Rai: Yes, we're not publishing the number at all. What we have seen is that as we've increased the amount of seats that users or team is able to have, we're seeing further collaboration. The review user has brought in more collaboration as well. And again, because there's a lot of misunderstanding about this, that video editing traditionally is not a very collaborative process. We know that. That's why we're building a collaboration version of it. So much like producing a print brochure 20 years ago was left to a designer and then an art-worker and then it went to the printer. It's a very linear process and video is the same. We're doing the same with what we're doing. So we expect collaboration to grow as the product grows and the market grows for this and it becomes more available. And I think the previous question actually was slightly different than just product market fit. It was a little bit about the paid users. So it was, thanks for the update on the space. You're telling us what potential paid users could do know a little more about what it is that's coming in order to in the future of the product, why are you not telling people, more people about what's coming. Now that's a very fair comment. We've actually been discussing this recently. We used to run a podcast at the beginning where we did discuss things like [indiscernible]. We're bringing that back into some format. We're not exactly sure of the exact format of it, but we expect in the next few weeks to see a new format where it is more updates from me, [indiscernible], the engineering team and things that will be hinting at what is coming. And more importantly, not every one of you, especially as investors uses the product. So you don't necessarily know some of the wonders that have happened, like the feeling of the new Boundary Boxes or how the looks are working. You just maybe hear about them in brochure, but it will be an opportunity for you to watch this and actually see them in action and obviously discussing maybe some up and coming things. We're definitely going to keen to do that and look after our user base. Ian McDonough: Thanks Sumit. Question statement, pricing strategy, keeping the early discount longer could have brought goodwill while the product matured. Yes. Thank you. That's a very good point. And to the point I made just slightly earlier is that we are in a learning phase, and therefore, we thought it was valuable to learn about how our product will be received at full price. But again, yes, I do think that's an interesting point. You featured a meeting with Boris FX, if you want to go on LinkedIn. Is there anything you can share on that? Sumit Rai: Nothing to share other than we are obviously in constant conversations with Boris FX. Ian McDonough: And how we utilize. Sumit Rai: Yes, absolutely. Ian McDonough: According to respective AFN members, adding mobile upload functionality to Elevate requires only a day of work for one person. Do you think that? Sumit Rai: Well, we don't compare. It didn't take one day, but the good news is today is the day and it is available. So please take a look at it and then reimagine whether that was one day's work. Ian McDonough: I have to say, yes, I think I would love to be able to take a finger around all these features just landing the product overnight. It will be amazing. You've got to remember that no one else has built what we built. And we built it in a very rapid amount of time. So yes, there is no global product like us. It's not easy. It's really not easy and the team are incredibly talented and incredibly working [indiscernible]. Thank you very much for that question. Ian, can you say a little more about the employee numbers and cutbacks that you mentioned in the interims, are features being delayed due to lack of developers? Yes. So we've really -- we are constantly being disciplined about cost. Cash is a concern for not just us, but every company in the world today, and we must be very disciplined about that. So we're reviewing, we review our teams all the time. I have to say that it's definitely not down to lack of developers that we are -- the products are arriving when they're arriving. I wouldn't say they're delayed at all. They're arriving when they're arriving and they're working at pace, and we have an exceptionally talented development team working on them. Great work from Kelly Kiara on the social videos. Give us off a round of applause, everybody loves you. Sumit Rai: Thank you. Ian McDonough: What do you consider to be your biggest threats to not realizing the amount of the TAM? I guess translating or not having enough marketing spend. Sumit Rai: That is a worry that not being able to communicate to the market with the effectiveness that some organizations may have. I'd say that's probably a threat to us. Ian McDonough: And the fact that not being able to explain the benefits of the product to a wider audience. And yes, that's true. As I said at the beginning, it's not a risk reinvestment. It's a potentially huge return. Sumit Rai: Another one is the biggest threat to us not being able to realize a large amount of TAM if we go down a [indiscernible] angle. So if we build a product like most of the online products that are available today in this space. Remember, we still see ourselves as the only professional grade product in the space. Most of the players in this space have gone down very, very narrow, very limited market. That market, there's -- all of them are in it. So they've not only taken a very small, a little or [indiscernible] the large part of the market, but a very unwilling to pay part of the market, and then they divide themselves amongst themselves. So what we must do is say, right, let's just focus on this one thing over here. That would be a threat to us if we're forced, we force ourselves but we're forced into that space. All we're doing is limiting ourself for the onset. Ian McDonough: Just to check over the question. I'm on question 36. How will you fund the business over the next few years given the small net new customer growth and the high cash burn without massively diluting your loyal and long-term shareholders given the share price of 1.9p and the market cap is sub 10 million. I think the key thing there is that we're building a revenue engine. And a revenue engine has to be profitable. You need to put one, you put a pound in and you get more than a pound out, it's profitable. If we can show that revenue engine working or we can show massive improvement towards that revenue engine working, then we have an investment case that we think is sound. We think we have visionary investors here and other places that will back that given the huge amount of opportunity there is in this [app]. So that's how we'll do it. Sumit Rai: Can I ask the one about [indiscernible]. Ian McDonough: Good question. So according to technically a member, Elevate is a light version of the software you already developed Blackbird, so why are you taking so long? And could you develop Elevate from scratch in a few weeks? Sumit Rai: So the answer is no, you couldn't have developed Elevate from scratch in a few weeks. Blackbird is actually a different product in a different market, although the technology has been applied directly to Elevate. And there's quite a lot of technology that hasn't yet been applied in Elevate that we'll be rolling out over time. So the key difference, if you think of it from a practical point of view, is that often in the Blackbird editor, you take 3 months to install it and [Whitebird] treatment to train people up. With Elevate, you can just come to the website and the feedback I've had from a lot of people is they can just sit down and use it. And so it's like a different audience and a different market and different level of support. It is a new product. But it has actually been accelerated a lot because all the Internet side of the technology has been ready made. And now we're moving on to GPUs. There's obviously synergy between the different parts, the different editors. In fact a lot of the work we've done is synergy between them for the new development. But the Elevate is actually a masterpiece in beautiful design and that reflects a different audience from focusing entirely on efficiency and people get paid to do it or they don't get a job versus creators who actually have aesthetic sense and they want a beautiful product as well as beautiful functionality. Ian McDonough: It will be fair to say that packaging is also completely different. One is on premise installation and [indiscernible] process. The other is something that scales in the cloud and in a different market. The heart and the core compositing is absolutely identical. In fact, innovation sometimes that elevate drives end up back in Blackbird and vice versa. But also the truth is it's taken many years to develop the Blackbird product as well. So it's not something that wasn't built overnight, so there's no reason to elevate. But the heart of both products is absolutely the same. The packaging of them is different. It's like [indiscernible]. All right. Next question. Cal, you've made many short videos aimed at beginners. Are beginners a key part of the marketing reach. Sumit Rai: Yes. So beginner and by the way, a credit to Kiara as well, who's been making a lot of videos and doing an amazing job, not just me. Yes. I think beginners are definitely a big part of it because elevate is being built to be a super intuitive, super easily accessible video editor. So we want to introduce elevate to beginners because it's so easy for them to get into it. And it's kind of like linking back to the Uber TAM story that Ian mentioned earlier, people that would have otherwise never -- video editors because the current offerings are just way too complicated, require heavy machinery. They are giving video editing a shot now because elevate is making it so accessible and so easy for them to get started. So yes, beginners are definitely going to be very important for us. Ian McDonough: Thanks [indiscernible]. Do you see the instant review tool as a way to help the virality of elevate.io? Sumit Rai: Yes. Definitely, it's the way in which people will -- their first touch will probably be for the foreseeable future, the most likely way that you'll use Elevate for the first time will be as a reviewer. We definitely know that, that will be part of our viral flywheel, and it's a great way to get it into people's hands. Frame io had exactly that same experience. Most people's Frame io experience started with receiving a link and being able to review something. So yes, it's a big part of our strategy. Ian McDonough: Will you need further funds to the scale-up phase? Our ambitions are topic. Our missions are industry changing. And yes, we will need more funds in the scale-up phase, but we will be taking our revenue engine to the market for that revenue phase for that scale-up phase. How often will you be communicating the update of your leading indicators to shareholders and investors monthly question mark. I think we'll be taking our leading indicators to you guys when we have the end of year results and other moments [indiscernible] like the AGM. As I said, every time we release numbers in the market, they go directly into the dynamic and exciting market that there is here and to our competitors. So we must be careful about how often we release all these numbers. Will any of you be adding to your shareholders at current record bargain base share prices with you clearly being very confident in the future. Also great to see the adverts. They look really sharp and really demonstrate elevate and its use. Well, as you know, we are big supporters of this company where all of us around the table here investing almost to our max in terms of how we can support the company. It is a bargain base price. And if we have funds available, then I'm sure we'll be investing in this exciting time and thank you very much for that. Sumit Rai: I don't mind saying that I obviously don't have to declare I'm not a Board member, but I believe I was the largest trade buying trade on Monday, and under 2p, it's -- when we talk about shareholder value, we'll judge whether 2p was good shareholder value in the future. To be clear, sorry, we only get the opportunity to buy stock at like 10 days a year. So we get limited opportunity. So the opportunity is there for us at the moment and that's great. Ian McDonough: Question from Jimmy Louie. I searched the Internet to ascertain the opinions. And what I have seen the opinions are good I'm personally in support of your aims. Thank you, Jimmy. When will elevate be finally ready finished and beautiful. I love the finished part. Sumit Rai: [indiscernible] behind it. It's an ongoing product. Already, it feels a lot more finished than it did 6 months ago. Those of you who use the product will know how much the last 2 months have meant in terms of its development, in terms of maturity. So we expect that certainly by the end of the product market fit phase, we're going to be in a great position. But even by the end of this year, I think people will be pleasantly surprised at how good it's getting. And that's the feedback we get from a lot of users and a lot of the different focus groups that we remained constant from the beginning of this project, the feedback has been phenomenal in terms of progress. Ian McDonough: Please describe the play and what to do or [indiscernible]. Sumit Rai: Yes. Quick publish beta is how it's going to be built on the menu. What that allows you to do is a published video of any length in almost no time, in seconds. And it creates a web page with a link and you can share the web page and it also gives you feedback on how many views you have and allows you to clip out the best bits and we share those. So it's a very easy way to distribute your content externally without having to do a render and people downloading and uploading stuff. And obviously, it's very useful for development because we can put the new technology in and roll it out to thousands of people and see what works or what doesn't work. Ian McDonough: Yes, [indiscernible]. Sumit Rai: Yes. So that's why we've limited it so far. And it will be hard to find, but it will be available to everyone in a few weeks. Ian McDonough: You've spoken for some time about the uniqueness and strength of Blackbird technology and now elevate.io Given that there has been no major strategic partner or Keystone customer who's really wanted to lean in and commit to being part of this journey. Do you want to look for this type of strategic involvement? Certainly, in terms of the partner, we are doing the development and roll out ourselves. In terms of the customer, I think that's absolutely something that we touched on. Sumit Rai: Collaborations we're working with organizations in collaboration with them to not only learn deeply about them, but to co-share marketing activities, which is great exposure for both organizations. Ian McDonough: Question 51. elevate is amazing. Thank you all. SBS. I imagine if you wanted to, you could put your feet up and do whatever you want in life. Sumit Rai: What do you want to do? Ian McDonough: What motivates you to develop elevate and what are your ambitions forward? Sumit Rai: Well, it's very rare you get a chance to change. And right back at the beginning, I invented cloud video editing, but the market was very small. In fact, everyone has always been saying we were too early. But now we've actually got a massive market front billions of billions. And with some [indiscernible] products actually making the tool that meets that need. So I'm very happy to supply the technology for that product. Ian McDonough: Thank you, Stephen, and thank you. How close are you to releasing AI captions capability? Sumit Rai: By the end of the year. it could be sooner. We absolutely keen and I released [indiscernible] future tech that's probably the first to market, and sometimes it's not just a race to be first, you've got to do it well because no one implementation of captioning, we feel is good enough for the kind of editor that we're building. So we are doing quite a -- we're doing a good implementation of it. We want to make it so that it really does work to scale, not only for people who just want to capture a small Instagram post, but also somebody who would use it to capture a 2-hour documentary. And we are going to -- the plans for it are going to be very -- going to mean it's to be a very good implementation. Ian McDonough: And yes, we absolutely know that's fundamental. It's fundamental to expected running of this product. And so we're really focused on it. Statement here, well done on your amazing innovation and total determination. Thank you very much, Philip. Given that next, the next results are 6 months down the road, are you going to give shareholders update on numbers before then? I'll refer back to my answer a few minutes ago, which is these numbers go direct to the competition, and we give out far more numbers than any of our competition do. So I would like to say that probably not. We are going to be doing our [indiscernible]. I'm a professional tax and business adviser. As a consequence, I come across different trades and professions. I'm in favor of initial face-to-face workshops. However, once there's been a minimal level of learning in future, I will consider online updates. How would elevate.io fit in with a live online meeting? Do you want to answer this one? Sumit Rai: Sure, yes. So yes, we also really, really understand and see the value of face-to-face, especially at the stage that we're at now where we're building our initial customer base. So the -- a few of our initiatives in the last couple of weeks and months have really demonstrated that. So for instance, the events play a big part in this. We've gone to events, and we've been demoing Elevate to so many different people and so many different teams, showing them exactly what's so special about it, how to use it. And that's been really, really effective. It's our first real play at like really just face-to-face, almost white glove type of initiatives. And the reception has just been absolutely incredible. It's been so validating talking to people. And what we've seen coming out of those is that it's very effective in generating leads and actually onboarding people onto the platform. So 100%, we're going to -- we're doing a lot of education. We had our first play at the webinar yesterday, as you know, that's going to improve and develop, and we're going to teach people how to use elevate at this point in time. We're a lean marketing team. But at this point in time, we can really do that. And it's all about educating people, showing them how to get onboard and showing them how to make videos. Ian McDonough: Thanks Cal. So, a question on EVS. Steve [indiscernible]. Stephen White: Yes. Any update on EVS? Well, there's 2 sides actually to EVS. We did announce in the RNS as well that we have actually been included as part of their offering for the winter games in 2026. So that will happen in Italy early next year. The second side to it is the technology licensing deal. And all I can say at this stage is, yes, EVS have been rolling out [IP] via Create to other customers. But at the moment, we are not in excess of our annual minimum guarantee. But when we are, then we'll let you know. Ian McDonough: Thanks, Sumit. Ian, you're targeting the U.S. East Coast. Do you have enough people out there to achieve your ambitions? Will you go there to start to push the product? I mean I would say at this stage that we are targeting the East Coast in terms of customers, in terms of [indiscernible]. And yes, we have enough people there to do that. Will I go out there personally? Well, I don't think I need to at this stage, but I was certainly visiting the U.S., I would think in the next few months for different reasons, and I would think very possibly to go to the East Coast. But we have someone on the ground in New York already, and we [indiscernible] on people when necessary when we're doing events. So yes, we have -- we're happy with our team presence over there currently. What is your target for paying users at the end of the product market at this stage? I think this is more about momentum. This is more about engagement and about retention and about conversion into paying users as opposed to absolute numbers. We will know when that stage is reached and it will be very much a case of selling that revenue engine at that particular point in time. Which month will product market fit actually be complete? Sumit Rai: Yes, I think on the scale, it shows towards the end of February 2026. But again, we -- it's not -- you don't set the date in the diary, it just [indiscernible] what happens. We will produce a bit more guidance obviously around the time and be clear about it. And it also doesn't mean that there is physically a day. I mean it will be a period where we say, okay, this is complete and we're moving forward. Ian McDonough: When you take on users, do you request data such as student filmmaker charge, et cetera? Maybe you want to build out on this one, [indiscernible]. Sumit Rai: Absolutely, yes. So we have an onboarding survey, and we've had that since the beginning of this year. So we've had that for quite a while. And we have a lot of data about our users, what kind of profile they have, what kind of skill level, what kind of videos they're making and that data has been very valuable, and we use it all the time when we do our analysis. And in addition to that, we also have our access survey. So also when people decide to leave, we also collect data and ask them why. So it's all about learning. It's learning through quantitative data, but also very much through qualitative data. So yes, we're absolutely doing that. Ian McDonough: Question for Sumit. Will we be able to store our projects in a folder in the near future? And will we be able to duplicate our projects in [indiscernible] copy. Sumit Rai: Yes. So Team folders comes out today, project being able to access the T media from a project within the media interface is going to trail slightly later and duplicate project is almost ready to go and is obviously a key part of a few things, one of which will be multiple sequences and then being able to have demo projects, which is also tied in to duplicate project. So lots of things in that space coming. Ian McDonough: I love the next question. When the marketplace is up and running, will there be a merch store so we can purchase those shirts? Great presentation update, confidence restored. Thank you very much, quite happy to hear it, to hear that. Yes, I think not our top priority, obviously, but why not? Cal, any chance you can make a video of a gorgeous setting, just price of a volcano eruption, then post it on your YouTube channel [indiscernible] with elevate advertising course. Sumit Rai: That is a really good idea. I could have come up with that. We need to do that. We need to do that. We'll scout out locations starting tomorrow. Ian McDonough: I sometimes think investors don't worry about how complex a development this can be. Perhaps you communicate to investors this is very hard. I think the podcast is going to go a long way to explaining the problems that we're solving, right? That's [indiscernible]. Sumit Rai: Yes. I mean the good news is that the development team who have obviously the core team from Blackbird who've been working on the core engine for a long, long time. But a lot of the people who worked on elevate have only been working for 3 years, including myself. And the one thing that we're very confident about and that we have achieved within the product market fit stage is that we now know how to do everything that we need to know. This, at least for the foreseeable future. There will, of course, be challenges that come down the road when we -- our ambitions widen. But we're very, very confident. But you have to remember, at the beginning of this, we had an idea of how, for example, multiplayer and the multiple courses of conflict resolution would work. We were sure of it that we know it can be done because of adjacent industries, but could be done on the video time line. All of the really important things that we didn't -- we may have had confidence in, but we didn't have the full answer to, we have achieved as part of the space that we're in at the moment. We -- everything we have been scared about has being solved and is working. So now we just have a lot of execution work and tidy up work to get to there and then into scale up and then the process will begin again and then we'll set our ambitions higher and have to go and solve more problems. But the efficiency of the team is absolutely true. And also that their understanding 3 years is some of them less than 3 years and some of them are one of our developers has only been with us a few weeks and already been responsible for the in and out points and the preview player that's been the first piece of work all achieved within -- certainly within the last month. And what's important is that the knowledge within the organization, within the development team of what is the right thing to do is now becoming second nature. And that's really important because this is not a trivial subject. It is a very detailed subject. It's stoked with legacy. It's got nuances that you wouldn't believe. And that's just very obvious, by the way, when you look at the other online video providers, some of the other online competitors, you can tell that they have not understood the video production process because of the way that they've done certain things. And for us, that team is really gelling. Ian McDonough: Excellent. When would you need your next cash injection, especially as you realize marketing is critical to realizing a large amount of TAM. Again, we answered a little bit earlier where we will be needing cash to scale up, of course, and we will be taking a revenue engine investment case to investors to do that. I think when we can show that fast improvement to the put a pound in and get a profit out, then we have a sound investment case to get to the new investment. Do you have any IP that protects your product from replication? Sumit, maybe you want to take one? Sumit Rai: Yes, we have quite a few patents for the technology, mostly the compression technology also makes the system very efficient on data as well as responsive and smooth. So yes, we have quite a few there. Ian McDonough: Question 69. If your new customer growth continues to underwhelm, how will you fund the business? It's easy to detail how you fund the business if everything goes as planned, but with the share price of 1.9, what are the options if slower growth happens. To answer your question, quite frankly, is that we are in an area where we have a huge potential opportunity to provide a return. It is not a risk-free investment. And it might not work. But at this point in time, we've derisked this product to an enormous amount versus where we were 6 months ago when we last spoke to you and certainly 2 years ago when we bought this plan to you. So I would say that we're in a fantastic opportunity to deliver versus where we were. But as I said, it's still not risk-free. Statements. Sumit, we love you and [indiscernible]. So how are we getting the message out that one of the things that elevate apart from the seeming competitors is it's so much more robust and able to do more short videos. I haven't seen this in the market messages. Over to you, Cal. Unknown Executive: Yes. So how do we get that message across? We get that message across through several different channels, right? You can't just use one channel to say something one time and then expect everybody to learn about that. I do think we speak about that. We talk about that on the website. We talked about that on our blogs. We make YouTube videos where we show how you can create longer-form content, not just vertical shorts on TikTok or anything like that. So if you're just following our Instagram, then that might give that impression that we're focusing on the shorts, but that's just because we're targeting the users on Instagram. If you're looking at our YouTube videos, it's quite a different story. We are showing landscape videos, longer types of formats. So yes, we will continue doing that. We always talk about how incredibly responsive elevate is versus other offerings, and that's really what sets us apart. We're a serious tool that works in the browser. Ian McDonough: No statements, it looks like the presentation has gone down well. The stock price is up. Well, thank you very much. And so it should be [indiscernible] a broader market. So I'm really pleased that we managed to explain it a little bit. I can't emphasize enough how important the Q&A is to us. Thank you so much for taking the time to speak with us. Very welcome. And yes, I think it's really important because it's not an easy thing to understand sometimes, as Simon said from [indiscernible] and other announcements. So it's really good to be able to talk to you directly. How many paid users are now needed to break even at the current cash burn? And do you have enough for paid users by mid to end of next year? I'd love to be to keep asking you for numbers. I'm not going to give any more numbers out than we have done. We give a lot more out than other companies our stage of development. So I hope you bear with us, and we'll release them when we think is the appropriate time. Share price up 0.25p since your presentation started, maybe a daily presentation work could work wonders. Thank you, Phillip [indiscernible]. Okay. I'm now going to go to question 76, which I think might be the last question. Is the plan to scale and then sell elevate or not? No plans to sell at this stage. We're a listed business, and therefore, we would love to enjoy the growth and rewards that come with being on the market as we grow. But no plans at all to sell the business. Thank you. Anything else anyone would like to add? Operator: If I may just jump back in there. Thank you very much, guys, for being of your time and addressing all of those questions that came in from investors this morning. And of course, if there are any further questions that do come through, we'll make these available to you afterwards. But Ian, perhaps before, as usual, just really now looking to redirect those on the call to provide you their feedback, which I know is particularly important to yourself and the company. If I could please just ask you for some closing comments, that would be great. Ian McDonough: Yes. Thank you very much, Jake. I mean I would say that's a very engaged session, and thank you very much for all your questions. We don't think this -- we don't underestimate how engaged you are. We know how important you are to our development. So it's a huge pleasure to be able to talk to you on these occasions. I will just finish by saying that I've never been more confident, more confident in the fact that we've got the right vision. We've got the right product. We've got the right timing, and we've got a huge global opportunity. So I hope you enjoy the light with us. Thank you very much. Operator: Perfect, Ian. That's great. And thank you all once again for updating investors this morning. Could I please ask investors not to close this session as you will now be automatically redirected for the opportunity to provide your feedback in order the management team can better understand your views and expectations. This will only take a few moments to complete, but I'm sure it will be greatly valued by the company. On behalf of the management team of Blackbird plc, we would like to thank you for attending today's presentation. That now concludes today's session. So good afternoon to you.
Operator: Good morning, and welcome to the AngioDynamics Fiscal Year 2026 First Quarter Earnings Call. [Operator Instructions] As a reminder, this conference call is being recorded. The news release detailing AngioDynamics' fiscal 2026 first quarter results crossed the wire earlier this morning and is available on the company's website. This conference call is also being broadcast live over the internet at the Investors section of the company's website at www.angiodynamics.com. A webcast replay of the call will be available at the same site approximately 1 hour after the end of today's call. Before we begin, I'd like to caution listeners that during the course of this conference call, the company will make projections or forward-looking statements regarding future events, including statements about expected revenue, adjusted earnings and gross margins for fiscal year 2026, as well as trends that may continue. Management encourages you to review the company's past and future filings with the SEC, including, without limitation, the company's Forms 10-Q and 10-K, which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements. The company will also discuss certain non-GAAP and pro forma financial measures during this call. Management uses these measures to establish operational goals and review operational performance and believes that these measures may assist investors in analyzing the underlying trends in the company's business over time. Investors should consider these non-GAAP and pro forma measures in addition to, not as a substitute for or as superior to financial reporting with measures prepared in accordance with GAAP. A slide package offering insight into the company's financial results is also available in the Investors section of the company's website under Events and Presentations. This presentation should be read in conjunction with the press release discussing the company's operating results and financial performance during this morning's conference call. Unless otherwise noted, all metrics and growth rates mentioned during today's call are on a pro forma basis, which excludes the results of the dialysis and BioSentry business that were divested in June 2023, the PICC and midline products that were divested in February 2024 and the radio frequency and Syntrax support catheter products that we discontinued in February 2024. Also, unless otherwise noted, all comparisons will be the first fiscal quarter of 2026 versus the first fiscal quarter of 2025. Now I'd like to turn the call over to Jim Clemmer, AngioDynamics' President and Chief Executive Officer. Mr. Clemmer? James Clemmer: Thank you, operator. Good morning, everyone, and thank you for joining us for AngioDynamics' Fiscal 2026 First Quarter Earnings Call. Joining me today is Steve Trowbridge, AngioDynamics' Executive Vice President and Chief Financial Officer. We had a great first quarter. We continue to grow across all areas of our business and performed especially well in the med tech markets that are critical to our future. Not only did we deliver excellent top line results, we demonstrated how that revenue translates into profitability. Our teams have struck the right balance between increasing profit and investing in our future, which includes developing and launching new products as well as regulatory expansion opportunities planned for the future. This combination of solid revenue growth with increasing profitability is the most important outcome of our strategic transformation. As many of you know, we have evolved our product portfolio from what AngioDynamics was historically known for to one that now competes in large, fast-growing markets. We are proven that our unique technologies can win and drive accelerated growth. In Q1, we grew our revenue by 12%, led by the continued strength of our Med Tech segment, which grew 26%, marking our fourth consecutive quarter with over 20% growth. We also achieved strong gross margins because of our revenue mix and our operations team driving solid performance even while managing the impact of tariffs that raised some costs during the quarter. Our Auryon business has delivered another exceptional quarter, which continues to grow well above market rates as we believe, we have the best technology to deliver better outcomes for patients with peripheral arterial disease. We are growing by taking share from all competitors in this space. And we are seeing our move into the hospital market continue to excel, allowing us to drive both top line growth and higher margins. We are bullish on Auryon as a long-term growth driver for our company, and we'll continue to invest to unlock new opportunities as demonstrated by our AMBITION BTK study and our plans for Auryon to compete in the coronary market in the future. We intend to continue proving why we believe our device is the most effective solution in the market. We want to expand access the new opportunities that broaden the TAM that we compete in. These studies will help achieve both goals. Auryon exemplifies how our company can take an innovative product, build a great team around it and execute with focus, which leads to strong growth and a great business. Our Mechanical Thrombectomy business grew by over 40% versus the previous year. Both AlphaVac and AngioVac saw strong customer growth, and we are pleased with the number of new users choosing our products. We are continuing to see new hospitals approve our products through their value analysis committees, and bring us into inventory as approved devices, which will drive increased utilization moving forward. The feedback we continue to hear from customers consistently highlights how a few of the unique design elements that we built into AlphaVac, provide substantial advantages and make it both safe and effective. The fact that a physician can use AlphaVac to treat PE without the need to reinsert a guidewire to safely navigate to the desired location is viewed as an innovative design feature that saves time and simplifies use even in complex interventional procedures. We will continue to add new features and expand the potential users for AlphaVac as the interventional treatment of PE patients will be a growth driver for our company for many years. Our NanoKnife team is delivering great results as we experienced growth of over 25%. Our expanded prostate indication allows us to educate and train urologists on our device and has an increased interest from doctors who are seeking an effective focal treatment option for their patients. We are working towards the January 1 date when our CPT I code becomes effective, which will help get our patients treated and our customers paid for the treatment. Physicians are excited to use NanoKnife because of its highly compelling the patient outcome benefits as well as the assigned payment aligning well with their expectations. The fact that our device can treat a patient in less than 1 hour makes it both a clinically and economically effective solution to offer their patients. As part of our effort to increase awareness with men, who may be seeking treatment options, we are launching a new AARP ad campaign this month to educate men and their families about how our device works and why the patient outcomes are terrific. We are excited to drive increased awareness and education for patients and physicians as we believe that NanoKnife can become the market-leading product to treat intermediate-risk prostate cancer, and we'll do everything possible to support that opportunity. Our Medical Device segment reported very strong results. We grew revenue over 2% year-over-year, led by strength in most of our categories. This business not only has excellent products that offer us attractive financial returns, but is also managed and run by a great team of people who know how to compete in more than one market at the same time. Overall, Q1 was a great start to our year. We're hitting on all cylinders. Our Med Tech business is accelerating. We're taking share with our superior technology, and we're driving sustained profitability. With our strong pipeline of clinical catalysts, expanding market opportunities and the operational leverage we're building, we're positioned to deliver significant value creation for our shareholders. Now let me turn the call over to Steve Trowbridge, who will provide more detail on our financial results. Stephen Trowbridge: Thanks, Jim, and good morning, everybody. And as always, before I begin, I'd like to direct everyone to the presentation on our Investor Relations website summarizing the key items from our quarterly results. Unless otherwise noted, all metrics and growth rates mentioned during today's call are on a pro forma basis, which exclude the results of the dialysis and BioSentry businesses we divested in June 2023, the PICC and midline products that we divested in February 2024 and the radio frequency and Syntrax support catheter products that we discontinued also in February '24. Additionally, unless otherwise noted, all comparisons will be the first fiscal quarter of 2026 versus the first fiscal quarter of 2025. Top line revenue performance was strong in the quarter. Revenue increased 12.2% to $75.7 million, driven by growth across both our Med Tech and Med Device segments. Med Tech revenue was $35.3 million, a 26.1% increase, and our Med Device revenue was $40.4 million, an increase of 2.3% As we mentioned in our Q4 call in July, this quarter provided a slightly easier comparison for year-over-year growth than we will see during the rest of FY '26. Now that being said, we are really pleased with the revenue growth we achieved during our first quarter. For the first fiscal quarter, our Med Tech platforms comprised 47% of our total revenue compared to 41% of total revenue a year ago, is illustrating the sustained execution of our strategy to increase the percentage of our overall revenue base coming from our Med Tech segment. In addition, in the slides accompanying our earnings release this morning, we illustrate the sustained growth of our Med Tech segment over the past 5 years. During this time, the annual revenue of our Med Tech segment has grown from $41 million in 2020 to $127 million in 2025, representing a compound annual growth rate of 25%. Digging into our Med Tech segment, our Auryon platform contributed $16.5 million in revenue, growing 20.1% compared to last year. Auryon has now delivered double-digit year-over-year growth for 17 consecutive quarters. As Jim mentioned, this growth is supported by our strategy to increase the percentage of our atherectomy business in the hospital side of care. In addition to this mix shift, we continue to grow our customer base in both the hospital and OBL settings. We also benefited from continued adoption internationally following CE Mark approval in September of last year, which drove approximately $500,000 of revenue in the quarter. Mechanical thrombectomy revenue, which includes AngioVac and AlphaVac sales, increased 41.2% year-over-year with revenue of $11.3 million. In the quarter, AngioVac revenue was $8 million, a 37.1% year-over-year increase, and AlphaVac revenue was $3.3 million, a 52.3% year-over-year increase. Total NanoKnife revenue was $6.4 million, an increase of 26.7% with pro-growth of 31.3%. We view each of our Mechanical Thrombectomy and NanoKnife businesses as strategically important, both in the near and long term and are very happy with their recent performance. We expect both to continue to deliver strong year-over-year growth and contribute meaningfully to our margin profile and profitability moving forward. As I previously mentioned, in the first quarter, our Med Device segment grew 2.3% year-over-year. We've stated that we believe that our Med Device segment will grow in the low single digits throughout the coming years, and we're pleased with the sustained performance. Now moving down the income statement. Our gross margin for the first quarter of FY '26 was 55.3%, a 90-basis-point increase from the first quarter of FY '25. Primary drivers of the gross margin improvement are pricing initiatives in both our Med Tech and Med Device segments, the sales mix shift to our higher-margin Med Tech products and operating efficiencies. We previously discussed our strategy to rightsize our manufacturing footprint to address labor constraints at our Queensbury facility and utilize third-party manufacturing partners. Our operations team has done a fantastic job executing on our strategy and has accelerated some of the gross margin initiatives driving gross margin improvement in the first half of our fiscal year, ahead of the scheduled completion date of January 2026. In addition, gross margin in Q1 included $1.7 million of tariff expense or roughly 220-basis-point impact. Touching briefly on tariffs. The expense in Q1 was in line with our expectations. And as we discussed last quarter, we continue to expect to incur between $4 million and $6 million of tariff expenses for the full fiscal year 2026. Total operating expenses in the quarter were $52.5 million, down to just 69.4% of sales compared to $50 million or 74% of sales last year, as we continue to drive operating leverage in the business. Turning to R&D. Our research and development expense was $6.4 million or 8.5% of sales compared to $6.3 million or 9.3% of sales a year ago. As we previously stated, we remain committed to investing in R&D initiatives to support the long-term growth of our Med Tech segment, and we're targeting approximately 10% of sales going forward. SG&A expense for the first quarter of FY '26 was $40.7 million, representing 53.7% of sales compared to $36.6 million or 54.2% of sales a year ago. This increase in spend is largely driven by the investments we have highlighted in an expanded Mechanical Thrombectomy sales force to support the growth of our Med Tech segment. Our adjusted net loss for the first quarter of FY '26 was $4.2 million or an adjusted loss per share of $0.10 compared to an adjusted net loss of $4.4 million or an adjusted loss per share of $0.11 in the first quarter of last year. This year-over-year improvement is largely attributable to our Med Tech revenue growth and the success of our expense management initiatives. Adjusted EBITDA in the first quarter of FY '26 was $2.2 million compared to an adjusted EBITDA loss of $152,000 in the first quarter of 2025. At August 31, 2025, we had $38.8 million in cash compared to $55.9 million in cash at May 31, 2025. As we mentioned in July, cash utilization is always highest in our first fiscal quarter. This year, cash utilization was a bit better than we expected. We continue to expect to be cash flow positive for the current full fiscal year, and in line with historical quarterly patterns, we expect to use approximately $3 million of cash in Q2. For Q3, we expect to use zero cash or generate some, and we expect significant cash generation in Q4. We maintained zero debt and have the flexibility to tap into our revolving credit facility, if needed. Turning now to guidance for fiscal '26. Based on our first quarter performance and our expectations for the balance of the year, we now expect net sales to be in the range of $308 million to $313 million, raised from our previously issued range of $305 million to $310 million. This increased range now represents growth of between 5% and 7% over fiscal '25 revenue of $292.7 million. On a segment basis, we now expect Med Tech net sales to grow 14% to 16%, an increase from prior guidance of 12% to 15%, and we continue to expect Med Device sales to be roughly flat. For fiscal 2026, we continue to expect gross margin to be in the range of 53.5% to 55.5%. This is inclusive of our reiterated estimate of $4 million to $6 million of tariff impact for the full fiscal year. Let me give a little more color on gross margin. We don't expect to see a significant step-up in margin during the balance of the year. As discussed above, we've accelerated some of our gross margin improvement initiatives during the first half, and we're seeing that here in our first quarter results. We now expect adjusted EBITDA to be in the range of $6 million to $10 million, up from prior guidance of $3 million to $8 million, again, inclusive of our estimated tariff impact. And finally, we now expect adjusted loss per share in the range of $0.33 to $0.23, improving from our prior guidance of a loss of $0.35 to $0.25. As you've just heard, we had a fantastic quarter, driven by the continued execution of our strategic transformation. We have a compelling portfolio of world-class products competing in attractive markets. We have a great global team, commercial, R&D, clinical, regulatory market access, all working together to bring innovative solutions to our customers, and we have the infrastructure in place to manufacture and deliver those technologies to our customers efficiently. Finally, we have a strong balance sheet, which will allow us to continue to invest in growth. We're excited about the momentum we've built and the opportunities ahead of us. We remain focused on executing across our businesses to drive sustained profitable growth and value creation during the balance of fiscal '26 and beyond. With that, I'll open the line for questions. Operator: [Operator Instructions] Our first question today comes from the line of John Young with Canaccord Genuity. John Young: Jim, Steve, it's John. Congratulations on the nice progress we're seeing here. I first wanted to start on just guidance, if I can. If I'm reading between the lines, right, from your comments, Steve, it sounds like the raise in Med Tech and the go-forward would mostly be predicated on the Mechanical Thrombectomy and NanoKnife segments. Am I right on that? And just any color on how we should think of the growth cadence between those two, especially with reimbursement for prostate coming online in fiscal Q3? Stephen Trowbridge: Thanks for the question. Yes, you're correct. If you think about the raising guidance going forward, it is primarily being driven by what we're seeing in the Mechanical Thrombectomy and NanoKnife spaces. As we mentioned, we're very pleased with Auryon and the performance that we've seen in Auryon and the 17 consecutive quarters of growth in that business, had a really good first quarter. We expect that to continue to be a solid contributor to our growth going forward. But we're really pleased with what we're seeing in Mechanical Thrombectomy and the sustained growth that we've seen in both AngioVac and AlphaVac over the last handful of quarters. We expect that to continue. It's one of the things that we pointed to at the end of Q4. We really like the portfolio that we have here in Mechanical Thrombectomy and the performance that we're getting out of that team, both here in the U.S. as well as globally and seeing some international contribution to growth. On NanoKnife, as we've said, we expect NanoKnife to be a grower for us and in the short, medium and long term. That's going to be one of the primary drivers of our growth. We're excited about what we saw here in the first quarter. We do have that code coming into effect on January 1. But as we said, we don't expect that to be a light switch that's going to immediately drive the hockey stick. But we're really pleased with the continued increase in interest coming from the urology community, the adoption for this technology to treat the intermediate risk prostate cancer patient. We think it's the absolute right solution. We're going to continue to see growth there. John Young: I appreciate that. And then just as a double click on the NanoKnife disposable revenue this quarter was just really strong. Any color on how much of prostate was in that disposable number? Is there any stocking? And just any KPIs that you could share would be great around that. Stephen Trowbridge: Sure. And the disposable numbers that we're seeing in NanoKnife as well as the capital that we're seeing in NanoKnife, that is being driven by our prostate initiative. By and large, the growth that we're seeing there is all coming from prostate and the increased awareness that we're talking about with the urology community. With your question on stocking, it's a product that we always expect that customers are going to be buying probes to have them on the shelf to be able to treat their patients. So I don't think I would point to anything as a significant onetime or unnatural progression that we're seeing here in our quarter. We expect customers to continue to adopt NanoKnife as a technology for their treatment options. They're going to continue to be buying probes, and we expect to see that growth continue. Operator: The next question comes from the line of Frank Takkinen with Lake Street Capital. Frank Takkinen: Great. Congrats on the quarter. I was hoping I could start in Mechanical Thrombectomy. Maybe an update around kind of hospital penetration would be helpful. And then how we should think about that trending going forward? James Clemmer: Frank, it's Jim. So we've seen really good uptake in interest at the hospital and that translates into our sales team then converting accounts into the value analysis committee approvals that we seek. It's always good to have a doctor buy one and try one, gain the confidence in the device itself. Then to go and put it through the Vac process, which is our ultimate goal to get on the shelf there. And there's a couple of other good products in that space, as you know. So we're really pleased with the adoption of the space. It's really important to us. We measure it every month. We watch the adoption. We watch our procedures grow every month. So it gives us more confidence in the device. And then just hearing physician feedback. I spent a couple of days last week at the Perth conference talking to a lot of the users who have tried our device recently, who know the other products on the market and are really confident in our device and some of those design element features we built in. So Frank, we're going to watch this, measure it well, invest in this space. As you know, we've added new sales reps into this fiscal year based upon our confidence. And we'll keep measuring it for you. But we have a lot of KPIs we track internally. Stephen Trowbridge: Yes. And Frank, just to add to what Jim said, I mean we are bringing on new customers in both the AngioVac and AlphaVac side of the house every quarter. We're really pleased with the trajectory that we're seeing there. We're still in the very early stages here. I wouldn't say that we're significantly penetrated. We've got a lot of opportunities to continue to grow both AngioVac and AlphaVac in the quarters ahead. Frank Takkinen: Perfect. That's helpful. And then maybe as it relates to some of the sales force hiring you did in Mechanical Thrombectomy, can you update us on where that sales force stands? And then, more broadly speaking, how should we think about other commercial investments across the Med Tech business? James Clemmer: Yes. Good question, Frank. I know at the last call, we talked about we ended our kind of fiscal 2025 with about 40 dedicated sales reps selling Mechanical Thrombectomy. And we mentioned we're going to invest about a 25% increase this year. So we have now 50 people, 50 territories identified who are just solely focused on AlphaVac and AngioVac. And based upon the feedback we received, we think that's the right cadence. So you'll see us continue to grow. If an investor looks back on the success we've had with Auryon, for example, we launched Auryon 5 years ago. And at the time, there were no sales reps so when we bought the product, launched it. Now we have about 40 reps dedicated to Auryon, and we added and expanded over time selling forward with the opportunity that we saw. So we'll do a similar model with our AngioVac and AlphaVac team, who's done a really good job getting customer awareness to the level we like. So you'll see that happen over time, not just investments in Auryon and the AlphaVac team, but next year, when we get the CPT I code up and running, you'll see investment probably over the next 3 years coming into that NanoKnife urology sales force to help service what we think will be a lot of increased demand. Operator: The next question is from the line of Yi Chen with H.C. Wainwright. Eduardo Martinez-Montes: This is Eduardo on for Yi. Just to follow up a little bit on the mix of growth and penetration versus utilization. For -- I guess to start with the thrombectomy. Is there any sense of revenue growth attributable to the price increase? I know that you guys have been playing around with that given the increase in price versus volume. Just to get a feel for how much is being driven by each of those factors. Stephen Trowbridge: Yes, it's a great question. We are seeing the ability to take some price in Mechanical Thrombectomy and we're doing that. But we're also bringing on new customers and we're seeing growth in terms of unit sales as well as utilization at our customer base. So it's a combination of all three. And I think that is a testament to the products that we have the portfolio and how well they're really being adopted by customers when they get their hands on them. Eduardo Martinez-Montes: Great. And I guess just any update on the ongoing clinical trials, BTK and how you're seeing time line for progression on these trials? And what ultimately findings you anticipate could unlock for the markets? Stephen Trowbridge: Yes. As we've said, we think this is a very important clinical trial both to our product line, but also to the market in general for atherectomy. And we think that Auryon has a unique place and a unique role to play in that. There's been some publications of some IITs of physicians who have used Auryon to treat below-the-knee calcifications and lesions with great outcomes. So we're very confident with what we're going to see. The structure of the AMBITION BTK study, we think, is important to have both the RCT segment as well as the Registry to prove that you can use Auryon, particularly and atherectomy below the knee and get good outcomes for your patients. We're very pleased with the pace that we're seeing, where we're seeing enrollment in both the -- both sides of that trial in the RCT and the Registry. They're pretty comprehensive. So it's going to be -- it's not going to be over immediately. But we're really pleased with the pace that we're seeing, the uptick, the interest in getting into this study with the clinical and scientific rigor that it has. And we think it will be a very big part of our Auryon business going forward. Operator: At this time, I'll hand the floor back to Mr. Jim Clemmer for closing remarks. James Clemmer: Thank you, Rob. Thank you guys for joining us today on the call. What you'll see from us is what you've seen this quarter. In the future, we believe that we have a company set up to win in the markets that we know are strong. They're difficult to compete in, but we've got significant technology advantages, and we're playing in the right spaces. Our team is supported by really good people who've helped us achieve these great results. Our teams here, across the board, have come above and beyond. We're a company with more than one moving part, and we ask people to do a lot and they deliver. We're also really encouraged by new people joining our company, who are also thrilled to join us based upon the direction we've changed this company towards, and they want to be a part of our journey. So folks, we're really excited with the results we just delivered, and we're really bullish on our future. We think we've changed this company. We've set it up well to win. We've got the right people to deliver. So thank you again for joining us. We'll talk to you soon. Operator: This will conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation.
Operator: Good afternoon, ladies and gentlemen, and welcome to the Avacta Group plc Interim Results Investor Presentation. [Operator Instructions] Due to the significant attendance on today's call, the company will not be in a position to answer every question received during the meeting itself. However, the company can review all questions submitted today, and will publish those responses where it's appropriate to do so. Before we begin, we'd like to submit the following poll. And I'm sure the company will be most grateful for your participation. I'd now like to hand over to the management team, Chris, Brian. Good afternoon. Christina Coughlin: Good afternoon, Mark. Thank you for having us, and good morning to our colleagues across the pond in states. My name is Christina Coughlin. I am the CEO of Avacta Therapeutics coming to you here from White City, London at our headquarters, and I'm joined by my Chief Financial Officer, Brian Hahn. We look forward to delivering to you today our interim results for the period ending June 30, 2025. As part of our presentation, both Brian and I will be making forward-looking statements. Recent research and development highlights from the company. We are currently enrolling our clinical stage program, faridoxorubicin, happy to bring that name to you for the first time today. It has been issued by the World Health Organization, FAP-Dox or AVA6000. We continue to enroll in the expansion cohorts in this program. Our second clinical program, and I use that term as FAP-exatecan, is quickly approaching the clinic. FAP-exatecan does remain on track to dose its first patient in the first quarter of 2026. As part of today's presentation, I would like to update for you one piece of data, one experiment that is ongoing, and show you the time line for that IND. Our clinical data with faridoxorubicin, FAP-Dox or AVA6000, and our clinical data -- our preclinical data with FAP-exatecan, and translational work in the pre|CISION program, all of these were presented as part of the period under review today. April of 2025, these 3 presentations occurred at the American Association for Cancer Research, the Annual Meeting that occurred earlier this year Those 3 presentations were quite pivotal for the company, in that we showed exactly what faridoxorubicin was able to do. Some very preliminary, but very encouraging data in the lead indication of salivary gland cancers for that particular program. FAP-exatecan, we did show a number of the preclinical studies. Again, with some of those being preliminary at the time, we're happy to update one key study today. And then the translational work, really highlighting some of the power of our Tempus collaboration there at the AACR. Avacta is slated to present the final Phase Ia dose escalation data for our lead program, faridoxorubicin. This will be at ESMO 2025 in Berlin, a little bit later next month in October of 2025. There, we are looking to present our longer-term cardiac safety data as well as updating the efficacy data that we have in that program. As promised, we have an updated data slide for you today. That's similar to how we are collecting longer-term survival data, progression-free survival data and overall survival data with our faridoxorubicin. We continue that with our FAP-exatecan program. And this animal model is what we call patient-derived xenograft, meaning that the tumor cells were taken directly out of the patient and instead of passaging them in a plastic dish, which changes the cells somewhat, these were injected directly into an animal model. And those are passaged that way, meaning that these cells don't see plastic in terms of our ability to keep these cells going. There's 2 important points on this slide. The first is the histology and a small inset there, showing in blue, the tumor cells; and showing in brown, the FAP-positive fibroblasts. This models what we see in the clinic and specifically what we have seen with our salivary gland indication for faridoxorubicin in that the tumor cells are all completely negative for FAP in blue. And the fibroblast, which actually come from the mouse themselves instead of humans, the fibroblast there are staining positive brown for FAP. This is exactly what we expect in most solid tumors, a low level of FAP expression compared with the number of tumor cells. If you let your eyes wander down to the below inset there, there's an important aspect of this animal model that we think critically tells us something important about the FAP-exatecan program. And that is this patient, prior to the biopsy being taken where this model was developed, this patient had been treated with irinotecan, another TOPO1 inhibitor. And what you're seeing in that small graph there, that small inset, is that this animal model is TOPO1 resistant, meaning irinotecan has essentially no activity in this particular animal model. We expect, based on some of the early clinical data with exatecan, that in animal models such as this might be sensitive to exatecan being a much more potent TOPO1 inhibitor. And that's exactly what we find in the animal model. On the left-hand side, you can see the actual tumor growth in 3 different groups in this experiment. The first in gray are the vehicle-treated animals. This is the natural history of this tumor type in this animal model. It grows very rapidly and is very aggressive. In orange, you can see, we delivered 3 doses of conventional exatecan. And what you can see there is after that third dose, which are depicted in the triangles, we start to see the tumors grow in these animal models. In navy blue is the growth pattern that we see with our FAP-enabled FAP-exatecan molecule. Importantly, we see now durable complete responses. Essentially, what you can see on the right-hand side of the waterfall plots is that nearly 4 out of 4 of the animals treated with FAP-exatecan developed complete responses. These are prolonged and sustained, and the durability of these responses despite the animals only receiving 3 doses, is critically important to us. It took us some time to pull these data together, exactly what is happening in the faridoxorubicin trial. It's the survival statistics and observing the patients or the animal model for some time, tells us something very important about the drug. An update now on the time lines for the IND and the dosing -- initiating the dosing in this particular program. In order to bring a program into the clinic, there are 3 activities that we continue to work on through that last year of the IND-enabling studies, and that is the manufacturing for patients, the preclinical program, including the good laboratory practice, toxicology studies that are in progress, and then as well developing the clinical stage program. So developing the clinical protocol for this and also bringing the clinical sites on board, which will lead us then to a first patient in the first quarter of 2026. So not too far off, and we're very excited to get started with this one in the clinic. Brian, let me hand it over to you for our financial update. Brian Hahn: Thank you, Chris. Cash and cash equivalents at the period end were GBP 12.65 million as compared to GBP 28.56 million for the same period in 2024 and GBP 12.87 million for year-end 2024. It's important to note here that this does not reflect the proceeds from the sale of Coris that we announced in late August of GBP 2.15 million. Cash outflows from operations and working capital movements were GBP 12.14 million for the first half of 2025. This is compared to GBP 12.6 million for the same period in 2024 and GBP 26.05 million for the full year 2024. Cash inflows from investing activities were GBP 8.77 million for the first half of '25. This reflects the proceeds of the sale of Launch Diagnostics. This is compared to cash outflows of just under GBP 1 million for the first half of 2024 and full year outflows of GBP 1.43 million. I'd like to note here that we've renegotiated the terms of the [ Heights ] Convertible Bond. We know this has been an overhang on the company. And we've also raised GBP 6.5 million gross to fund 2 quarterly payments of the cash bond. Year-to-date bond settlement was GBP 5.1 million. Bond balance as of 30th June 2025, was GBP 25.5 million, and it is now reduced down to GBP 22.95 million by the 30th September 2025. Christina Coughlin: Thanks, Brian. Moving on. Our upcoming key data list, data catalysts for the 2025 and then into 2026. So where are we and where are we going next? So our faridoxorubicin program, FAP-Dox, has advanced to the expansion cohorts, Phase Ib, that is completed. We look forward to updating the data in late 2025 in salivary gland cancer. We are on track for that. That will be a combined update from both the dose escalation portion of the trial as well as the expansion cohort data. We will be updating the Phase Ia, as mentioned, at ESMO, and that will not include any of the expansion cohort data. We are also on track to deliver the initial data in the triple-negative breast cancer cohort. That will be in the first quarter -- or the first half of 2026. For our FAP-exatecan program, Program 2, we are looking forward to dosing the first patient in the Phase I, that is on track for the first quarter of 2026. And then finally, we're excited to note that we are on track for our pipeline program update, and that one will be on track and will occur later in October. And we're excited to bring that one. It is a new way of leveraging our pre|CISION platform and a whole new way of looking at it and using this in the clinic. Very excited to bring that to you later in October. So as you can see from these catalysts, with both ESMO and our pipeline update, we're going to have a very busy October in front of us, a number of key updates from the company coming there. And so that brings me to the strategic opportunities and what is the outlook for the company. I mentioned at the beginning our collaboration with Tempus and how this had delivered in a few different ways. Let me describe some of those. The first is the Tempus collaboration really delivered on the overall market opportunity for our pre|CISION medicines, confirming for us 90% of patients with solid tumors have FAP expression at some level. Important data will be coming at ESMO, looking at the different levels of expression and how we see the platform moving forward. The second is that the Tempus collaboration really is delivering for us a much smarter clinical trial for the FAP-exatecan molecule. And finally, Tempus has even touched our next pipeline update in terms of what are some of the ways that we could be thinking about essentially using the pre|CISION platform moving forward. We very much look forward later in October for that pipeline update. We are engaging with third parties across a range of commercial opportunities. This really reflects the breadth of the pre|CISION platform and where we're going to be able to take the pre|CISION platform now that we've entered the next chapter of a pure-play biotechnology company. We're happy to note that industry interest in our innovative platform continues to increase, and that pipeline update planned for next month really factors into this importantly. We do have a highly enviable intellectual property position. Let me tell you why. For the foundational IP, we have another 10 years of this that is exclusively licensed of the pre|CISION peptide, and this mechanism of action is wholly owned by Avacta. Our sustained release mechanism IP just filed last October is owned by Avacta. It was filed last year, and the full patent life for this one is anticipated to last to 2045. We will implement this sustained release mechanism, this novel IP into our novel pre|CISION medicines and all new pre|CISION molecules coming in the pipeline. We also have a great deal of confidence that the pre|CISION platform is increasingly well suited and very attractive to pharma and biotech partnerships for a range of oncology indications. Back to the first bullet there, the Tempus collaboration really showed us the market opportunity that we have here. And we continue to have that confidence in our platform and excited to very much bring you the updates that we will see in October. Mark, I'll hand it back to you for questions. Operator: That's great. Chris, Brian, thank you very much indeed for updating investors. Ladies and gentlemen, please do continue to submit your questions. But just want to -- can we take a couple of minutes to review your questions submitted already. I'd just like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A, can be accessed via your investor meet company dashboard. Firstly, thank you to everybody for your engagement this afternoon and for the questions you sent ahead of today's event. Chris, if I may, I'll start off by reading out some of these questions that hopefully cover a number of the themes. I know we've had a number of questions around funding perhaps. So let's start off there. What are the fundraising priorities for the remainder of 2025? And how do you plan to minimize dilution for existing shareholders, whilst ensuring adequate capital for clinical development? Christina Coughlin: Thanks, Mark. So as Brian reported, the company currently has a cash runway that extends into the first quarter of 2026. And as you know, we are laser-focused on strategic partnerships, business development. We are prioritizing those strategic collaborations that would provide both funding as well as development expertise with potential partners. Our maturing Phase Ia as well as the Phase Ib trial data are critical to these discussions. The purpose of those equity raises that we've done a bit earlier in 2025 were exclusively to address the need for the quarterly payments of the convertible bond, as Brian mentioned. These have been causing negative pressure on the share price. And we're -- as Brian mentioned as well, we're really happy with the renegotiation of that. As we always have been, we're focused on tight cash control, and we carefully allocate our cash very, very carefully into each of our programs. But in terms of any next steps, we're not giving any time lines. It would be inappropriate for us to state when and how until any deal is really agreed. Brian, do you have anything to add to that reply? Brian Hahn: What I can add here is the Board is not worried. You're aware, we're working on a number of options to fund our R&D programs. We have a number of levers, including partnerships, JVs, industry investments and/or equity funding. The data from pre|CISION is only improving. As Chris mentioned, we are seeing industry interest in our platform increase, and our business development activities continue. Christina Coughlin: Yes. Correct. Correct. Agree, Brian. We -- just to add to that, we are discussing both indications of faridox -- we're now using its new name, faridox, with a number of potential partners. There's a lot of interest as well in FAP-exatecan. But the company's strategy on that particular molecule remains -- we want to retain 100% ownership of this one. It's so close to the clinic. It's so close. And until it enters the clinic and delivers, we want to retain that 100%. It's been a decision made with the Board of Directors, and that is on track for the first quarter of 2026. And as you all know, we're quite energetic in our business development discussions. We have a range of potential partners, and it is a key focus of our financial strategy. The maturing data really factor into this, the maturing data in our clinical programs. And as we discussed in that last slide there, we are really approaching some key inflection points for the company coming up soon. Operator: Great. Well, let's stick to the subject, I guess, how much do you expect Phase II for faridoxorubicin to cost Avacta? How will you fund this if a partnership doesn't materialize? Christina Coughlin: So we're very confident in the maturing data in the Phase Ib of faridox. And we think that this will support the long-term value of this asset. Salivary gland cancer is high unmet need, and we continue to collect data in the various cohorts. We have committed that we won't start the further development activities in the absence of a partnership. However, as I've said, the maturing data set in Phase Ib is providing us with ample confidence that pre|CISION is working exactly as we designed it to work. The development in the expansion cohort is well underway. We believe the preliminary data here will provide that natural inflection point for the program. It's going to provide also clarity on accelerated approval pathways that we might be able to seek. And also, there's really an opportunity for the overall market to digest essentially the commercial potential for the program and the platform. As I mentioned, we'll have that pipeline update, platform update. And so we're really excited about the fourth quarter for the company. Operator: I guess we've been discussing imminent license deals and partnerships now for several months, but nothing has materialized. Can you comment on where you are with this? Christina Coughlin: Sure. It's completely understandable. We know that this is a recurring theme for our shareholders, and we appreciate the comments that we get here. I've already shared a lot as to our expectations here. But let me wax poetic on this a bit. We are in multiple conversations across multiple assets. The data in Phase Ib does continue to mature, which is really strengthening Avacta's position here. On timing, I can't give definitive answers, that wouldn't be appropriate. But what I can tell you though is that the team has a clear plan and we are executing on that plan. We have a number of touch points with a number of potential partners coming up. Our objective is really to exploit the potential of this technology for the benefit of patients and shareholders. And so whilst it may not be reflected in our share price today, these improving data sets, both clinical, but also on the preclinical side of things that we are seeing, these really strengthen the intrinsic value of our technology. We're looking to leverage this value for shareholders, and we will continue to update as we can on this particular topic. Operator: I guess a question really relevant to all those over 1,000 people that registered for today's call. Around the share price really, why does the share price still not reflect the value in today's pipeline? Christina Coughlin: Let me let Brian take that one. Brian Hahn: Biotech really follows a normal path. The only constant is good technology ends up with partnerships under buyouts. Avacta has a clear strategy, which it's executing, and we have shown in the clinic that our tech does what we designed it to do, concentrate the drug in the tumor while sparing healthy tissue from toxicity. Operator: That's great. Okay. Commercial strategy. I guess you have touched a bit on this throughout your presentation, but I wondered if you could just share a little bit more on your commercial strategy with those on the call. Christina Coughlin: Sure. So we've chatted before on this. And commercial strategy, to us, really reflects sort of 3 -- I think about it in 3 buckets. The first is our business development strategy, partnering deals, which we have touched on. As you noted, Mark, the long-term funding strategy for the company. And then also, one can think about the game plan for commercializing a drug. We do have the opportunity to commercialize both of our assets that have been disclosed, faridoxorubicin as well as FAP-exatecan. So let's think about each of these. So faridox, our lead program. We've successfully completed the Phase Ia. It has an excellent safety profile, encouraging PFS data in the salivary gland indication. And there's promising early signals in the ongoing Phase Ib that we continue to observe and continue to have those conversations with third parties. The development in the expansion cohorts, this is underway. The preliminary data is expected later this year, and it's going to provide sort of a natural inflection point for the program. It's going to provide clarity on accelerated approval pathways. And there's also an opportunity for the market to look at these carefully. For faridox, we anticipate releasing the initial data in salivary gland cancer late in 2025 and triple-negative cancer in the first half of 2026. Now our second asset, FAP-exatecan, this one is going to advance into clinical testing, and we anticipate initiating that trial in the first quarter of 2026, with the initial data available in late 2026. I have to be honest, I don't think that Avacta is given enough credit for how quickly, and the speed with which we have taken AVA6103 through preclinical testing and advanced straight to IND-enabling studies. I am extremely excited. If you haven't heard, I've nicknamed it the beast. But I'm very excited about seeing this one in humans for the first time. The new data that we shared today, or I should say, the updated experimental data, really speak to what this invention is and what we're seeing here with this particular drug. I'm so excited about this one. This is what my entire career has been about, novel breakthroughs in the fight on cancer. I've shared with many of you in my personal story here and like -- let's call it my personal vendetta against cancer. We've been asked quite a bit about this particular program. How does it work? And what is this new invention that we're talking about? And so I'm happy to tell you that we are bringing you an R&D spotlight tomorrow that will go -- it's a bit of a deeper dive into this particular asset and the sustained release mechanism. Now here in the office at Avacta, I've had the advice to tell everyone to have -- to pour a strong cup of tea. It is 23 minutes of the chemistry. We usually put a leash on our chemists, and they're unleashed in this one. It's not for the faint of heart. But aside from faridoxorubicin and FAP-exatecan in the pipeline, there's also the opportunity for us to develop a partnership with another oncology drug in a potential partner's pipeline. It would be inappropriate for me to say anything more on that at this time, but it is something that our business development team and our R&D team are really laser-focused on. And I will commit to you that we will continue to update shareholders as soon as we are able to do so. Operator: That's great, Chris. Well, let's switch gears a little bit and talk about R&D, I guess. In the salivary gland cancer data in late 2025, Q1 of 2026, the key inflection point, when will that read out? Christina Coughlin: So as you have seen, we can make periodic updates prior to the full salivary gland data set. We will reveal the entire data set as we have it in late 2025, late this year. And that data update, this is not the ESMO data. I want to be 100% transparent here. The ESMO data is going to be the dose escalation. That will be an update on the 11 patients that we saw the preliminary data at AACR. Late 2025, we're going to be looking at both the expansion cohorts, which are ongoing, as well as the dose escalation. So think about a larger data set in late 2025. We commit to hosting an investor meet regarding these data, and we will be hosting an investor meet right along with the ESMO data and then later in 2025 with the full data set as we have it, that will be released in the salivary gland cancer indication. Operator: What encouraging clinical activity has been observed in the AVA6000 Phase Ib trial? Christina Coughlin: So the initial clinical activity here in Phase Ib is encouraging, it's highly encouraging. It has increased the management team's confidence in the pre|CISION platform, the value, the utility. We look forward to sharing that later this year. But as I'm sure you can appreciate, we're not able to disclose further information at this time. The Phase Ia dose escalation at ESMO, I'll be in Berlin with Dr. Tap, who has been a long-standing supporter of the company and of the program, in October. We will be looking there at the longer-term cardiac safety data. The Phase Ib data, though, in that expansion cohort, will be at the end of 2025. And as well, the triple-negative breast cancer patient data in the first half of 2026. Operator: Okay. And maybe let's talk about AVA6103. What is the status of the AVA6103? Are you still on track to dose in Q1 of '26? Christina Coughlin: Yes. So 100%. We're happy to bring you that update today. FAP-exatecan remains on track. First quarter of 2026, it's those 3 areas that we're working on, manufacturing and the nonclinical program and then the clinicians, the clinicians in the company are quite busy. The initial data from FAP-exatecan, we anticipate late 2026 being able to make some early comments on the program. This program, again, I've called it the beast. It builds on the validated pre|CISION technology. It builds on that biopsy data, my favorite slide in the deck, as I always say. It builds on the ability of the pre|CISION platform to really concentrate the drug in the tumor microenvironment. Keep it as best we can out of the bloodstream. And what that does is it minimizes the toxicity, optimizes the efficacy. And we're very encouraged by the initial clinical activity showing how this platform works, and really excited to get the second one into the clinic. Operator: Great. And let's stick with AVA6103. You mentioned that the data had changed with the animal model of the [ FAPX ]. Since the previous data was released, why is this so important? Christina Coughlin: Yes, it's a great question. Why rehash this animal model that we already presented at AACR? It's one of the reasons that we do periodic updates on the clinical trial. It takes time for us to see survival durability. All of these endpoints take time to mature. Our animal models work in the exact same way as the patients. We have to continue to observe. And sometimes, it looks a lot better. If anyone wanted to pull up that exact figure from the AACR presentation, you'll see it was cut off with the data that we had at the time. And as we allow that animal model to mature, you can see that some of the lines end, so the vehicle-treated animals end. The exatecan, the conventional exatecan arm, that one ends as well because 3 doses is not enough of conventional exatecan, conventional chemotherapy. But what you can see in that new data is the tremendous durability of the responses with the FAP-exatecan molecule. This is exactly how we designed the sustained release mechanism. At the time that we still have responses in this animal model, we actually can't detect the exatecan anymore. And so it's active even at those really low doses is because it's such a potent drug. It's an important observation. It speaks to, frankly, what we're seeing in the early days of the salivary gland cancers, that we see this durability and sometimes the patients stay in responses even after we remove the drug. What we're pleasantly surprised at in this is that only 3 doses of FAP-exatecan lead to these kinds of responses. Again, I know I've said it before, this is exactly how we designed this drug, long and slow release of the payload, exatecan, which can then lead to these durable complete regressions. I've said it before, I can't wait to get this one into the clinic. Operator: That's great. Okay. Let's talk about shareholder communications and a number of questions around that. How is Avacta improving its shareholder communications? Christina Coughlin: Thanks for that one. First, I want to say, once again, Avacta greatly appreciates the support and the engagement of all of our shareholders. And we do take the feedback very seriously. We take it on board and we try and work better with it. Our approach is to really provide, what we think are informative deep dives into our progress, the clinical and the preclinical programs, and we try to do that at regular scheduled points through the calendar year when the need arises. We have investor engagement events such as this one. We have also listened to feedback from investors. So specifically at the AGM -- and we are responding to that. We will schedule investor meet presentations around every data release. And so I can commit to you that we will have an investor meet around the ESMO Congress. We will also have an investor meet later in October around that pipeline update. And then as we go deeper into this year, we will also host an investor meet around the data that will be released from the expansion cohorts. We heard that feedback, and we absolutely take that on. We're also going to commit to organizing live events. Shareholders have the opportunity to meet the management team, the scientists at Avacta, and to ask questions of us. We had a very good interaction at the AGM, and we will continue to build on that. Also, let me also mention that we have our regular R&D spotlight series videos that -- we put those on both the X platform and LinkedIn, and those will start to come through the investor meet as well. So you don't have to go to social media. That's another that we've heard. This is to educate on the pipeline. We have 2 new episodes coming up. The first is tomorrow, again, we're going to release that one with the sustained release mechanism explained. And then a bit later in October, we will have one of the R&D spotlights that really speaks to and speaks -- understanding of this new pipeline update. We're really excited to bring that one to you later in October. But what I also have to mention, though, is outside of these events, we can't respond directly to investor queries about the share price, matters that we can't discuss. These include, for example, our ongoing corporate opportunities, decisions being made, data that hasn't been released, clinical development progress, all of these. We would need to disclose these all transparently to the wider market. But we want everyone to rest assured, we will continue to engage. As part of these shareholder investment forums, we will look forward to R&D spotlight series. Tomorrow's episode is in direct response to a number of questions from shareholders about, can you really explain how this sustained release mechanism works? And so we commit to updating you via our public announcements when we have material news. Operator: Great. How does Avacta think about competing peptide drug conjugate platforms at Philogen and Bicycle? Christina Coughlin: Great question. So our pre|CISION platform has a couple of key differences compared to these other peptide drug conjugates. We often get this question from institutional investors. So let me take Bicycle first. The Bicycle peptide drug conjugates don't use a cleavable technology. That's one big difference between the pre|CISION platform and the Bicycle platform. The Bicycle peptide is designed to direct the payload to the tumor. And we think the reason that pre|CISION and this tumor-specific cleavage is so critical, in our mind, it's borne out in the clinic. We see a tenfold great -- back to my favorite slide, but we see a tenfold greater concentration of active payload in our biopsy samples compared with the published data from the Bicycle peptide. So while they see 10x concentration, we're seeing a median of a hundred-fold concentration. It was -- and I've mentioned this before, but it was really during a Board meeting when I saw those data for the first time, that I thought to myself, I'd really like to have a full-time role. I was just a nonexec at that point. But anyway, we also think that these data allow us to leverage much more potent payloads. That's why we can be bold and moved into the exatecan program. And then to take the second part of that one, it's similar, but the Philogen approach also uses a FAP cleavable linker, so much closer to the pre|CISION technology. However, they do substitute out the alanine residue. Remember, ours is an alanine, proline, and it's a post -- FAP is a post-proline cleaving enzymes. And so that substitution actually greatly reduces the specificity for FAP cleavage. So it will be cleavable by other post-proline cleaving enzymes. And so that reduces the specificity of the Philogen approach. And so we would predict that their results would be similar to the Bicycle. Lower specificity would mean lower concentration in the tumor micro environment, but also it could result in higher rates of toxicities because those cleavage points would be -- the cleavage would be not just specific in the tumor, but you could see more of those ADC-like toxicities there. Operator: There's a couple of questions around tariffs. I don't know how relevant this is, but what will U.S. tariffs on pharmaceuticals impact our clinical trials? Chris, can you hear us then? Christina Coughlin: Yes, I lost the audio there for a second. I don't know what happened, Mark. Operator: Sorry. No worries. Just a couple of questions on tariffs. Will U.S. tariffs have an impact on clinical trials? Christina Coughlin: Interesting question, especially as Brian and I hail from the States. But no, the tariffs are imposed currently on approved marketed drugs and those manufactured outside of the U.S. So since our programs are all pre-approval, the tariffs won't impact us. Operator: Great. Well, look, I think from a Q&A point of view, I'll submit all the questions to you. And if there's any topics that we haven't covered, Chris, we can always give clarity post today's call. But before I redirect investors to give their feedback. I wondered if you had any further comments before I redirect investors to give you some feedback? Christina Coughlin: Yes. So thanks for the opportunity. Avacta is in a very strong position. I hope you can hear from myself and Brian, we're super excited about the technology. We are executing on the goals that we've set for ourselves. We are seeing execution in our strategy, and everything is going according to plan. We're very much looking forward to the fourth quarter of this year. We're making great progress, and look forward to our next updates to shareholders, which include those data at ESMO, the pipeline update, which is a whole new way of thinking about the pre|CISION platform and how we can leverage that for the benefit of both patients and shareholders. We're moving our second program forward in the first quarter of next year. I've been quoted in saying programs are not children, so I'm allowed to have a favorite. The exatecan program is just -- it is sort of everything that we thought this platform could be, delivering a highly potent drug directly to the tumor, minimizing a lot of normal tissue exposure. It's exactly how pre|CISION was designed. So very excited for a number of updates that are coming over the next several months. And I'll be honest with you. I think that the future is very bright for this company. It is very bright. I've shared with many of you, as an oncologist, I gave many of these drugs in my clinical practice. I treated many teenagers with soft tissue sarcoma. I gave doxorubicin. What Avacta has been able to accomplish here is truly remarkable. And we are so excited to have a second program moving into the clinic. We're thrilled that the management team can now focus on delivery of pre|CISION as a pure-play biotech oncology company. And I'll say it again, the future is very bright for our company. And we're very grateful for our shareholders who have come along with us. This has been -- a dream of mine is to really impact cancer, and Avacta is doing it. So proud of all the scientists here, grateful to the sites, the clinical trial sites and very grateful, at the end of the day, to the patients who have signed up for our trials. I think we've got a very bright future in front of us. Operator: Chris, thank you very much indeed. Chris, Brian, thank you very much indeed for updating investors. If I could please ask investors not to close the session. We'll now automatically redirect you to the opportunity to provide your feedback in order that the company can better understand your views and expectations. This may take a couple of moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of the management team of Avacta Group plc, we'd like to thank you for attending today's presentation, and wish you all a good rest.
Alex Ng: Good afternoon, and welcome to Stolt-Nielsen's Earnings Call for the Third Quarter of 2025. As always, the earnings release and related materials are available on our website. We will also be recording the session, and playback will be available on the website from tomorrow. Included in this presentation are various forward-looking statements. Such forward-looking statements are subject to risks and uncertainties, and we refer you to our latest annual report for such details. I'm Alex Ng, Vice President of Corporate Development and Strategy. Joining me today are Udo Lange, CEO; and Jens Gruner-Hegge, our CFO. At the end of the presentation, there will be a Q&A session where we will be taking questions from online. [Operator Instructions] Thank you, and over to you, Udo. Udo Lange: Thanks, Alex. Welcome, everyone, and thanks for joining us today for our third quarter results. The presentation will follow the usual format. I will begin with an overview of the Group's results for the quarter and share key highlights. Then Jens will cover the financials, before handing back to me to run through the performance of our divisions, our view of the market outlook and a few concluding remarks. Despite a challenging macro backdrop of ongoing global trade and geopolitical uncertainty, our businesses enjoyed a resilient performance, delivering a quarterly EBITDA of over $190 million and a last 12 months EBITDA above $800 million for the sixth quarter in a row. The company has delivered consistent performance again this quarter. This has been achieved through the dedication, professionalism and spirit of our 7,000 people around the world working tirelessly in pursuit of being simply the best for our shareholders, customers and people. Our portfolio also builds in resilience to market fluctuation with 45% of our EBITDA this quarter achieved outside of Stolt Tankers. While Stolt Tankers' EBITDA fell 27% from the same quarter last year, the other areas of our operations delivered an increase in EBITDA of 13%, diluting the impact of softer shipping markets. These results demonstrate that the company is a liquid logistics solutions provider and show the impact of our diversified portfolio. Last week saw the annual EPCA conference in Berlin. That's the European Petrochemical Association event that brings together some of our largest global petrochemical customers. We met many of our customers and heard from them the challenges they are facing as they navigate the current uncertain market conditions. We also heard directly how our suite of liquid logistics solutions across the supply chain is more relevant than ever. Our value proposition delivering quality, reliability and flexibility is meeting our customers' needs and has supported another resilient quarterly performance. I want to reiterate the message we first communicated at our Capital Markets Day last year. We are not a shipping business, but a logistics business. To help our investors and analysts, we have focused our commentary on our liquid logistics operations, which contribute nearly 90% of our EBITDA. And so you will notice that we have scaled back our commentary on Stolt Sea Farm and Gas operations. You may also remember that at the time of our Q2 report in July, we evolved how we communicate our earnings potential, aligning our guidance approach with our business model by providing EBITDA guidance for the full year 2025. Today we have refined our range, with 2025 EBITDA now expected to be in a range of $750 million to $700 million (sic) [ $790 million ]. Of course, this range is based on what we know today, assumes no substantial geopolitical changes and is subject to a number of uncertainties in the current operating environment. As always, we continue to maintain a conservative balance sheet benefiting from robust liquidity and well-spread debt maturities. Let's now turn the page to review our financial highlights. I've already said we have delivered another consistent result despite a challenging operating environment. Moving along the top row. Operating revenue was down nearly 5% or $33 million, predominantly driven by weaker freight rates and Stolt Tankers. EBITDA before the fair value adjustment was $192 million, down $23.5 million on the record levels from last year. Operating profit was down year-over-year by $30 million, partly due to the additional depreciation applicable to the HS4 ships and Avenir. Net profit was also down, driven by the same factors, as well as higher interest expenses due to the consolidation of acquisition debt. Free cash flow was down $77 million year-over-year, driven by higher CapEx, including the NST newbuilding deposits, higher interest expense and sale of 2 vessels in the third quarter last year. Net debt-to-EBITDA has increased to 2.94x as a result of an increase in consolidated debt from HS4 and Avenir. Over the page, we look at some of the key drivers of performance. Looking at our performance metrics. Average deepsea TCE revenue per operating day for the quarter was just under $25,000, down versus last quarter. This is due -- down versus last year's record highs. This is due to softer sentiment impacting freight rates, particularly in the spot market. However, TCE for the quarter remains at an attractive level versus the long-term cycle average. Utilization remains on an upward trajectory at Stolthaven Terminals at almost 92%. We expect utilization to be stable over the coming quarters going into 2026. Gross profit per shipment declined 5% at STC, predominantly driven by lower ocean freight rates and the wait-and-see mode of customers in this complex supply chain environment. Our portfolio continues to demonstrate resilience to market fluctuations as around 45% of EBITDA achieved outside Stolt Tankers is nontanker operations producing a 13% EBITDA growth year-over-year. That's all from me now. Jens, over to you for the financials. Jens Grüner-Hegge: Thank you, Udo. Good afternoon, everyone, and good morning to those of you joining us from the United States. I will compare the third quarter of 2025 against the third quarter of 2024. And just to remind you, our third quarter runs from June 1 through August 31. And to reiterate what Udo talked about, the company's performance is resilient, and with the growth in EBITDA contributions from the nontanker segments, we're able to maintain a strong EBITDA at $192 million for the quarter before the fair value adjustment of biomass. If we move to the next, let's dive into the numbers for this quarter. So the drop in revenue was predominantly driven by tankers reflecting the lower spot rates. This was partly offset by a 6.6% increase in volume following additions to the fleet over the last 12 months. STC's revenue was marginally down, but offset by an equal increase in Stolthaven Terminals. Operating expenses were down in line with the reduction in revenue, but also due to the acquisition of 100% of Hassel Shipping 4, resulting in the business no longer being accounted for as a JV but being fully consolidated. And this caused the decrease in the TC expense or the pullout expense, and that was partly offset by an increase in owning expenses which forms a big part of their operating expense. Depreciation expense was also up as a consequence of the consolidation of Avenir and Hassel Shipping 4 as well as due to the capitalization of additional time-charter ships as per IFRS 16. And the equity income from joint ventures was down, driven by the same consolidation of the joint ventures. So A&G expense was up compared to last year, mostly reflecting annual inflation adjustments as well as a consequence of the weaker U.S. dollar, partly offset by lower profit sharing accruals related to lower net income. Operating profit for the quarter was $109.4 million, that's down from the $139.3 million, as Udo mentioned. But that was a record quarter last year. And that's driven predominantly by the weaker tanker results. And net interest expense was up $4.9 million due to an increase in net debt following the 2 acquisitions and other capital expenditures. FX gains on hedges were up, also driven by the weakening of the U.S. dollar. And income tax was up, reflecting the improved earnings in the nontanker businesses. And consequently, net profit for the quarter ended up at $64 million, with EBITDA of $191.7 million, and this is down from the same period last year and slightly weaker than the previous quarter this year. So if we move over to the next, we can have a look at the cash flow. So cash from operations was strong this last quarter, almost as high as the peak third quarter of last year. Net cash was down due to an increase in interest payments during the quarter. And note that the cash interest payments differ from the interest expense shown on the previous slide due to the timing of payments, with the first and third quarters normally having higher payments. Cash spent on capital expenditures was substantially up, reflecting in part increased progress payments on newbuildings and terminal CapEx as well as a reduction in gain on sale of assets as we sold 2 ships in the third quarter of last year. And then during the quarter, we also repaid a net $59.6 million of debt and capital leases. FX had a minor positive impact on our cash balance as we consequently ended up with an increase in cash from prior quarter of $30.8 million, but a decrease compared to the same quarter last year of about $170 million when we sat on cash in order to effect the acquisition of 100% of Hassel Shipping 4. Also last year, we had just completed the U.S. private placement of $450 million that was concluded during the same quarter last year. At the bottom right, you see our total liquidity position, which at the end of the third quarter was at $466 million, and that's also slightly up from the last quarter. So let's have a look at the capital expenditures on the next slide. Capital expenditures during the quarter, you will see total $75 million, in line with the previous quarter, and it brings our total so far this year to $372 million. Remaining for the year, we have approximately $200 million, with $42 million for tankers, reflecting progress payments on newbuildings, $36 million for Stolthaven Terminals, reflecting additional organic growth and maintenance CapEx, $102 million in STC on the purchase of additional tanks and approved expansion of depot capacity, and $20 million for the rest, including progress payments on Avenir's newbuildings program and computer systems development expenditures. So overall for 2025, we now expect to spend around $500 million on capital expenditures. If we go to the next one, we can have a look at the debt maturities. So this is the debt maturity profile. And that, of course, includes the consolidation of the debt of Hassel Shipping 4 and Avenir. If you look at the balance for '25, there's 3 portions there: $126 million, $83 million and $53 million. We have already repaid during September $126 million as it related to a sale leaseback facility and we have already secured a financing needed to repay the remaining maturing facilities during the fourth quarter, although we may roll forward the $83 million credit line to the next year as we have the option to do. If you look at the bottom-left graph, the increase in gross debt in the first quarter reflects the consolidation of the Avenir and Hassel Shipping 4 debt. And in the third quarter, we saw a slight decrease. But I would expect this to increase again with the significant capital expenditures we have planned going forward. The average interest rate remains flat at about 5.6%, and we don't expect any material swings in the average interest rate over the next quarter as the bulk of our debt is fixed. And then moving over to the next slide, a quick look at the financial KPIs. Our continued steady performance supports our covenants. And the increase in debt and, therefore, net debt to tangible net worth and net debt to EBITDA seen in the previous quarter was due to the acquisition of Hassel Shipping 4 and Avenir, and we have seen it stabilize since. Debt to tangible net worth is now at 1.01, as you see in the top-left graph, well below our covenant limit of 2.25 and slightly down from the prior quarter as well. With the lower EBITDA for the quarter, the last 12 months EBITDA fell slightly to $814 million, but as Udo mentioned, still well above $800 million. And EBITDA to interest expense was marginally down at 5.86, as you see in the top right quadrant, due to the increase in interest expense, whilst net debt to EBITDA, which is a key measure of our liquidity position, decreased from 2.96 down to 2.94, so very marginal, really remaining flat. So overall, we are well within compliance on all our covenants. And with this, I would like to hand it back to Udo for the segmental analysis of our business, our view of the market outlook and a few closing remarks. Udo Lange: Yes. Thank you, Jens. I'll now take us through the divisional highlights, and beginning with Stolt Tankers. As I mentioned earlier, tanker markets have softened as elevated supply chain complexity has resulted in softer volumes, which has had a direct impact on spot rates and performance in Stolt Tankers. Operating revenue saw a decline of 13%. This is predominantly due to a 90% decline in freight rates driven by reduced specialty cargo volume. The rate decline was only partly offset by an increase in operating days due to additions to the fleet over the past 12 months. As usual, Q3 saw seasonally low COA renewals, which year-over-year were at a rate decrease of 14.6% versus the peak last year. Operating profit was impacted by the decline in revenue as well as an increase in port expenses due to the opening of the Panama Canal. I want to thank Maren and the tankers team for their unwavering efforts to support the customers to navigate this highly complex environment, and they're really doing a great job. We now look closer at tanker rate development. The Q3 TCE per operating day was just under $25,000 per day, down from $33,355 in the same quarter prior year, which marked the most recent peak in the cycle. As a reminder, we typically fix cargo bookings 30 days in advance of the start of a voyage, with voyages being renewed on a rolling basis, which results in a lag effect of around 90 to 120 days between changes in rates and the full impact on earnings. You can see, for example, on the chart that both TCE peaks lagged versus spot index rate. Near term, we are not expecting to see signs of the current uncertainty abating. But we are seeing the adjacent MR and [ VL ] markets strengthen into the winter, which should be supportive to the chemical tanker market as we head into the winter contracting period. And we have seen some stabilizing of spot rates. That said, we are not just a chemical tanker business. We encourage the market to consider our performance across all the areas of our diversified portfolio. And I want to remind you that we have moved to full year EBITDA guidance for the business as a whole. Stolthaven Terminals positioned as an owner and operator of infrastructure servicing the chemical and energy industry results in stable and steady performance, relatively insulated from the volatility elsewhere. Utilization trended upwards in Q3 and is at 92%, which is expected to be stable over the coming quarters. EBITDA was flat year-over-year. Whilst revenues increased due to utilization, we saw some impact from inflationary cost increases and higher depreciation. We expect the storage markets to remain stable, notwithstanding market headwinds, which could result in delayed decision-making on tanker rental commitments. I commend Guy and his team. Delivering increased revenue and stable EBITDA performance is an achievement given the market backdrop. Revenue and EBITDA were slightly down in STC as the impact of the macro environment dampened market demand and transportation rates as customers took a wait-and-see approach to moving products. STC have been working to increase shipment volumes, but this could not fully offset lower gross profit per shipment versus last year. We saw a slightly larger impact on operating profit as higher A&G costs and expenses related to fleet growth contributed to larger decline in operating profit. Continuously changing trade flows require an agile approach, which suits our global platform well. Stolt Tank Containers will therefore continue its focus on stabilizing margins while maintaining volumes. Despite a challenging environment, Stolt Tank Containers contributes meaningful to the Group's return on investment and aligns with our strategy to leverage our market-leading scalable platform. Big thanks to Hans and his team for the global platform they have built. This helps us to be agile for customers and balance volumes and margins on short notice. I now want to cover our view of the market and concluding remarks, before we open for Q&A. Despite the ongoing elevated uncertainty, we see market fundamentals that remain well-balanced between supply and demand. In a world of elevated trade flow and supply chain complexity, some weakening sentiment is likely to result in 2025 volumes being flat year-over-year. However, industry expectations for the seaborne chemicals trade continue to be for modest growth in 2026, which could be supported by stability and trade policies. We continue to closely monitor GDP development as we see some macro downside risks based on market indicators and analyst expectations. On the supply side, MR rates seem to be stabilizing at a level that would typically keep them operating in the CPP market, limiting the potential to swing into our market. In addition, effective October 14, USTR 301 is expected to come into force. Whilst our chemical tanker segment is exempt from the port fees, there will be port-related fees for Chinese-owned tonnage in our segment. Whilst this will not remove supply from the global fleet, we may see some supply impact on U.S.-related trade routes as Chinese owners retrench from that trade. On the ordering side, we have seen limited growth in the newbuild order book, which has remained stable this quarter at around 18.5% of the global fleet due to the macro environment and high newbuild prices. We expect modest net growth of around 3% into 2026 and continue to closely monitor developments on risk and the resulting impact on rate supply. One important lever our industry has is the opportunity for asset owners to pull back supply in case of a market downturn. We see around 26% of stainless steel tankers aged 20 years and older in 2027, meaning that a significant percentage of the global fleet could be retired if necessary to manage supply. To sum up then, I talked to you earlier about how our chemical industry customers are being impacted by market volatility from global trade policies and geopolitics, with the resulting ripple effect into demand for our liquid logistics services. We are hearing from our customers that in the midst of this deep supply chain complexity, they really value our quality, reliability and flexibility. We are therefore focused on executing our liquid logistics strategy as a compelling value proposition that is even more important in these uncertain times. We are pursuing targeted investments, planning to spend some $500 million in 2025, positioning the business for long-term growth and making our liquid logistics solutions even more relevant for the future. This would not be possible without a strong balance sheet, and we will continue to maintain a conservative balance sheet with significant flexibility. Finally, despite the uncertain conditions, our business portfolio supports a steady EBITDA performance, achieving over $190 million this quarter. And we expect the full year EBITDA to fall within a range of between $750 million and $790 million. So to summarize, we are well positioned for the long term with the right people, the right strategy and a robust balance sheet to support the targeted investments that will facilitate our future growth. Thank you for your attention, and I will now pass you back to Alex for Q&A. Alex Ng: Thank you, Udo. [Operator Instructions] So our first question is for you, Jens, and it relates to EBITDA guidance. Your full year EBITDA guidance now implies a rather large range, between $160 million and $200 million. Could you shed some light on what the key uncertainties are here? Jens Grüner-Hegge: Thank you very much, Alex. And thank you for your question. It's a good question. I'll first like to reiterate what we have talked about the resilient business model that we do have, which is really building on multiple legs that we have to stand on. And we expect that that will help us as we go into what continues to be an uncertain environment. Udo has already touched on a number of the aspects where we are sort of building in, call it, a little bit of room for the uncertainty. We mentioned the MR market and the development of that. And our financial performance could be impacted by swing tonnage, really dependent on what we see as in terms of MR market development. We have talked about the USTR, and we think we're in a very good position there now because our entire fleet is compliant with USTR, and that means we can trade in and out of the United States without incurring any fees. But you have other operators who are not in such a position, and therefore, we could see volatility in other areas and other trades not related to the U.S. And then we have talked about the tariffs. There's still a lot of uncertainty around tariffs with U.S. recently announcing a 50% tariff on Brazilian imports and Indian imports and China retaliating. And we feel that it's warranted to have a little bit of a headroom for those kind of uncertainties. Just like to remind you that when we talk about sort of the volatility in net profit or in EBITDA related to a swing in time-charter equivalent, typically, we have said that a $1,000 swing in TCE related earnings equates to about $6 million to $7 million in EBITDA. So that's for you to keep in mind when you look at -- do your own sensitivity testing. Alex Ng: Thank you, Jens. A question for you, Udo, again, relating to trade policies. Do you expect any positive effects from the tariffs in the longer term? Udo Lange: So of course, this has puts and takes. So at the end, if you look at our business, in particular, when it comes to the tankers, that probably you have the biggest impact, it's all about ton-mileage growth. And so depending on where the tariffs are on which products, but then also what that may open up as other trading opportunities, this can also fall into the positive way. So it really depends what are the specific tariffs, what is then the impact on that trade, and is there then an attractive alternative trade which potentially could even drive more ton-mileage growth? So it's really the devil is in the detail on this one. Alex Ng: Thanks, Udo. And next question relates to CapEx, so one for you, Jens. I'll just combine a couple of questions. But the first element is, we've noticed an increase in CapEx for the end of the quarter for 2025, particularly in relation to STC. Could you provide some insight into what types of projects they are and when they could be expected to improve earnings there? Jens Grüner-Hegge: So related to the STC CapEx, sort of consistent with our ongoing desire to build on that scalable platform that STC has built by increasing our tank size, our number of tanks as well as expanding on our depot capacity. So this is consistent with our strategy. I'm sorry, Alex, the other -- when we expect to get the -- well, the nice thing about investing in tank containers is that typically the lead time is significantly shorter than it is when you invest in the more longer-term, capital-intensive businesses like tankers, terminals, et cetera. So what we are spending now, you will start seeing the benefit of in 2026. Alex Ng: Thank you, Jens. And then a follow-on from CapEx. Could you elaborate on what the CapEx spends are in 2026? And how is it phased throughout the year? Jens Grüner-Hegge: Absolutely. Again, thank you for the question. So there's 3 big buckets for 2026. It's tankers, it's terminals and it's what we have grouped under corporate. For tankers, the bulk of it, say, 80%, 90% of it is related to the newbuilding program that we have, so that's about $120 million of the total and a little bit to be spent on barges. For terminals, about $80 million relates to our ongoing investments at our Houston and New Orleans terminals, the organic growth that we have previously announced there, that will come on in 2026. And the rest is sort of steady maintenance CapEx that we have ongoing every year. And then for corporate, you can split sort of 80% with Avenir and 40% related to Stolt Sea Farm. For Avenir, it's related to our newbuilding program there. Alex Ng: We have a question on the USTR and managing uncertainties around the enforcement of this. Do we have any exposure in relation to the Chinese built, owned or operated vessels? A question for you, Jens. Jens Grüner-Hegge: Can you please repeat the question? Alex Ng: Yes. It's relating to the U.S. restrictions around Chinese-built vessels. Do we have any exposures there? Jens Grüner-Hegge: Sorry. As I mentioned in the previous question, we have made sure that we have no Chinese-owned ships in our fleet. And therefore, we are at full liberty to trade in and out of the U.S. without any additional port charges. Udo Lange: I just want to add there and really applaud the teams. So a particular big shout out to Maren and Bjarke from the tanker side, and then Nick, our General Counsel, and then Jens and the team as well. Because I think 2 key things that we have done extremely well is, one, really advocating the position on with our customers as well as with the administration in the U.S., which was key for getting the exemption. But then really, Jens and the team looking at where do we have any exposure from a financing side and then cost-correcting there as well. So we can proudly say at this point in time, thanks to the agile leadership of the team, there's zero exposure for Stolt-Nielsen on USTR when it gets into effect. Alex Ng: Next question is in relation to Stolt Sea Farm and the performance there. So one for you, Jens. There appears to be a large fair value adjustment in that segment. Can you explain what it's in relation to? And any other comments around the strong performance and how that's being driven in Stolt Sea Farm? Jens Grüner-Hegge: So dealing with the fair value, as those of you who have followed us for a while will know that that's always something that fluctuates up and down. It's more noise than anything going through our results, which is why we also report our EBITDA excluding the fair value effects when we talk to you in these presentations. The magnitude of it is -- was between $6 million and $7 million this year, but there is a negative one in the prior, the same quarter last year, which is why it causes a big swing. And the driver of results at Stolt Sea Farm is similar to what we talked about before, it's volume and price-driven and really a sound operation that we have built there. But normally -- so we changed to not talk about it because it is very small in comparison to the overall balance sheet. If you look at Stolt Sea Farm, this comprises less than 10% of the asset base. I think it's actually down to around 3% to 4%, Alex. So that's why we have now elected to really focus on what truly drives the results of the Group, and that is our logistics businesses. Alex Ng: Thank you. [Operator Instructions] Next one is relating to the debt profile. Can you give more insight on that $93 million debt repayment during the quarter? Was it primarily paydown or early repayments? If you can remark on that. Jens Grüner-Hegge: Yes. So some of it was early repayments related to ships that we previously had on sale leaseback. And that's partly also what -- that's partly what has allowed us to now sit with a fleet that is non-Chinese owned. And in conjunction with that, we have also taken on a few additional refinancings to help position the company for '26 and the capital expenditures that will come in the future, putting us in a very good liquidity position. But our debt balance, as you have seen, then continues to evolve with every quarter. And that is so that we can make sure that we get the best rate structure and the best profile structure for our asset base as we move forward. Alex Ng: And the final question that we have on the list is, can you provide any guidance in relation to dividends expectations for -- payout for the year? For Jens. Jens Grüner-Hegge: No, the dividends are really something that is determined by the Board and determined by -- eventually approved by the Annual General Meeting. They take into consideration our financial -- the markets that we operate in, our financial position, our commitments going forward. And this is a holistic evaluation that the Board makes. So beyond that, I think all we say is we've typically been rather steady in what we have been doing, but those are considerations for the Board to make and not for me to comment on. Alex Ng: Thank you very much. Okay. Thank you. That completes our questions. We'll post a recording of the call on our website tomorrow. Udo, back to you. Udo Lange: Yes, thank you for joining us today. I look forward to talking to you again when we present our results for the full year. Again, thank you, and I wish you all a great day.
Operator: Good afternoon, ladies and gentlemen, and welcome to the Avacta Group plc Interim Results Investor Presentation. [Operator Instructions] Due to the significant attendance on today's call, the company will not be in a position to answer every question received during the meeting itself. However, the company can review all questions submitted today, and will publish those responses where it's appropriate to do so. Before we begin, we'd like to submit the following poll. And I'm sure the company will be most grateful for your participation. I'd now like to hand over to the management team, Chris, Brian. Good afternoon. Christina Coughlin: Good afternoon, Mark. Thank you for having us, and good morning to our colleagues across the pond in states. My name is Christina Coughlin. I am the CEO of Avacta Therapeutics coming to you here from White City, London at our headquarters, and I'm joined by my Chief Financial Officer, Brian Hahn. We look forward to delivering to you today our interim results for the period ending June 30, 2025. As part of our presentation, both Brian and I will be making forward-looking statements. Recent research and development highlights from the company. We are currently enrolling our clinical stage program, faridoxorubicin, happy to bring that name to you for the first time today. It has been issued by the World Health Organization, FAP-Dox or AVA6000. We continue to enroll in the expansion cohorts in this program. Our second clinical program, and I use that term as FAP-exatecan, is quickly approaching the clinic. FAP-exatecan does remain on track to dose its first patient in the first quarter of 2026. As part of today's presentation, I would like to update for you one piece of data, one experiment that is ongoing, and show you the time line for that IND. Our clinical data with faridoxorubicin, FAP-Dox or AVA6000, and our clinical data -- our preclinical data with FAP-exatecan, and translational work in the pre|CISION program, all of these were presented as part of the period under review today. April of 2025, these 3 presentations occurred at the American Association for Cancer Research, the Annual Meeting that occurred earlier this year Those 3 presentations were quite pivotal for the company, in that we showed exactly what faridoxorubicin was able to do. Some very preliminary, but very encouraging data in the lead indication of salivary gland cancers for that particular program. FAP-exatecan, we did show a number of the preclinical studies. Again, with some of those being preliminary at the time, we're happy to update one key study today. And then the translational work, really highlighting some of the power of our Tempus collaboration there at the AACR. Avacta is slated to present the final Phase Ia dose escalation data for our lead program, faridoxorubicin. This will be at ESMO 2025 in Berlin, a little bit later next month in October of 2025. There, we are looking to present our longer-term cardiac safety data as well as updating the efficacy data that we have in that program. As promised, we have an updated data slide for you today. That's similar to how we are collecting longer-term survival data, progression-free survival data and overall survival data with our faridoxorubicin. We continue that with our FAP-exatecan program. And this animal model is what we call patient-derived xenograft, meaning that the tumor cells were taken directly out of the patient and instead of passaging them in a plastic dish, which changes the cells somewhat, these were injected directly into an animal model. And those are passaged that way, meaning that these cells don't see plastic in terms of our ability to keep these cells going. There's 2 important points on this slide. The first is the histology and a small inset there, showing in blue, the tumor cells; and showing in brown, the FAP-positive fibroblasts. This models what we see in the clinic and specifically what we have seen with our salivary gland indication for faridoxorubicin in that the tumor cells are all completely negative for FAP in blue. And the fibroblast, which actually come from the mouse themselves instead of humans, the fibroblast there are staining positive brown for FAP. This is exactly what we expect in most solid tumors, a low level of FAP expression compared with the number of tumor cells. If you let your eyes wander down to the below inset there, there's an important aspect of this animal model that we think critically tells us something important about the FAP-exatecan program. And that is this patient, prior to the biopsy being taken where this model was developed, this patient had been treated with irinotecan, another TOPO1 inhibitor. And what you're seeing in that small graph there, that small inset, is that this animal model is TOPO1 resistant, meaning irinotecan has essentially no activity in this particular animal model. We expect, based on some of the early clinical data with exatecan, that in animal models such as this might be sensitive to exatecan being a much more potent TOPO1 inhibitor. And that's exactly what we find in the animal model. On the left-hand side, you can see the actual tumor growth in 3 different groups in this experiment. The first in gray are the vehicle-treated animals. This is the natural history of this tumor type in this animal model. It grows very rapidly and is very aggressive. In orange, you can see, we delivered 3 doses of conventional exatecan. And what you can see there is after that third dose, which are depicted in the triangles, we start to see the tumors grow in these animal models. In navy blue is the growth pattern that we see with our FAP-enabled FAP-exatecan molecule. Importantly, we see now durable complete responses. Essentially, what you can see on the right-hand side of the waterfall plots is that nearly 4 out of 4 of the animals treated with FAP-exatecan developed complete responses. These are prolonged and sustained, and the durability of these responses despite the animals only receiving 3 doses, is critically important to us. It took us some time to pull these data together, exactly what is happening in the faridoxorubicin trial. It's the survival statistics and observing the patients or the animal model for some time, tells us something very important about the drug. An update now on the time lines for the IND and the dosing -- initiating the dosing in this particular program. In order to bring a program into the clinic, there are 3 activities that we continue to work on through that last year of the IND-enabling studies, and that is the manufacturing for patients, the preclinical program, including the good laboratory practice, toxicology studies that are in progress, and then as well developing the clinical stage program. So developing the clinical protocol for this and also bringing the clinical sites on board, which will lead us then to a first patient in the first quarter of 2026. So not too far off, and we're very excited to get started with this one in the clinic. Brian, let me hand it over to you for our financial update. Brian Hahn: Thank you, Chris. Cash and cash equivalents at the period end were GBP 12.65 million as compared to GBP 28.56 million for the same period in 2024 and GBP 12.87 million for year-end 2024. It's important to note here that this does not reflect the proceeds from the sale of Coris that we announced in late August of GBP 2.15 million. Cash outflows from operations and working capital movements were GBP 12.14 million for the first half of 2025. This is compared to GBP 12.6 million for the same period in 2024 and GBP 26.05 million for the full year 2024. Cash inflows from investing activities were GBP 8.77 million for the first half of '25. This reflects the proceeds of the sale of Launch Diagnostics. This is compared to cash outflows of just under GBP 1 million for the first half of 2024 and full year outflows of GBP 1.43 million. I'd like to note here that we've renegotiated the terms of the [ Heights ] Convertible Bond. We know this has been an overhang on the company. And we've also raised GBP 6.5 million gross to fund 2 quarterly payments of the cash bond. Year-to-date bond settlement was GBP 5.1 million. Bond balance as of 30th June 2025, was GBP 25.5 million, and it is now reduced down to GBP 22.95 million by the 30th September 2025. Christina Coughlin: Thanks, Brian. Moving on. Our upcoming key data list, data catalysts for the 2025 and then into 2026. So where are we and where are we going next? So our faridoxorubicin program, FAP-Dox, has advanced to the expansion cohorts, Phase Ib, that is completed. We look forward to updating the data in late 2025 in salivary gland cancer. We are on track for that. That will be a combined update from both the dose escalation portion of the trial as well as the expansion cohort data. We will be updating the Phase Ia, as mentioned, at ESMO, and that will not include any of the expansion cohort data. We are also on track to deliver the initial data in the triple-negative breast cancer cohort. That will be in the first quarter -- or the first half of 2026. For our FAP-exatecan program, Program 2, we are looking forward to dosing the first patient in the Phase I, that is on track for the first quarter of 2026. And then finally, we're excited to note that we are on track for our pipeline program update, and that one will be on track and will occur later in October. And we're excited to bring that one. It is a new way of leveraging our pre|CISION platform and a whole new way of looking at it and using this in the clinic. Very excited to bring that to you later in October. So as you can see from these catalysts, with both ESMO and our pipeline update, we're going to have a very busy October in front of us, a number of key updates from the company coming there. And so that brings me to the strategic opportunities and what is the outlook for the company. I mentioned at the beginning our collaboration with Tempus and how this had delivered in a few different ways. Let me describe some of those. The first is the Tempus collaboration really delivered on the overall market opportunity for our pre|CISION medicines, confirming for us 90% of patients with solid tumors have FAP expression at some level. Important data will be coming at ESMO, looking at the different levels of expression and how we see the platform moving forward. The second is that the Tempus collaboration really is delivering for us a much smarter clinical trial for the FAP-exatecan molecule. And finally, Tempus has even touched our next pipeline update in terms of what are some of the ways that we could be thinking about essentially using the pre|CISION platform moving forward. We very much look forward later in October for that pipeline update. We are engaging with third parties across a range of commercial opportunities. This really reflects the breadth of the pre|CISION platform and where we're going to be able to take the pre|CISION platform now that we've entered the next chapter of a pure-play biotechnology company. We're happy to note that industry interest in our innovative platform continues to increase, and that pipeline update planned for next month really factors into this importantly. We do have a highly enviable intellectual property position. Let me tell you why. For the foundational IP, we have another 10 years of this that is exclusively licensed of the pre|CISION peptide, and this mechanism of action is wholly owned by Avacta. Our sustained release mechanism IP just filed last October is owned by Avacta. It was filed last year, and the full patent life for this one is anticipated to last to 2045. We will implement this sustained release mechanism, this novel IP into our novel pre|CISION medicines and all new pre|CISION molecules coming in the pipeline. We also have a great deal of confidence that the pre|CISION platform is increasingly well suited and very attractive to pharma and biotech partnerships for a range of oncology indications. Back to the first bullet there, the Tempus collaboration really showed us the market opportunity that we have here. And we continue to have that confidence in our platform and excited to very much bring you the updates that we will see in October. Mark, I'll hand it back to you for questions. Operator: That's great. Chris, Brian, thank you very much indeed for updating investors. Ladies and gentlemen, please do continue to submit your questions. But just want to -- can we take a couple of minutes to review your questions submitted already. I'd just like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A, can be accessed via your investor meet company dashboard. Firstly, thank you to everybody for your engagement this afternoon and for the questions you sent ahead of today's event. Chris, if I may, I'll start off by reading out some of these questions that hopefully cover a number of the themes. I know we've had a number of questions around funding perhaps. So let's start off there. What are the fundraising priorities for the remainder of 2025? And how do you plan to minimize dilution for existing shareholders, whilst ensuring adequate capital for clinical development? Christina Coughlin: Thanks, Mark. So as Brian reported, the company currently has a cash runway that extends into the first quarter of 2026. And as you know, we are laser-focused on strategic partnerships, business development. We are prioritizing those strategic collaborations that would provide both funding as well as development expertise with potential partners. Our maturing Phase Ia as well as the Phase Ib trial data are critical to these discussions. The purpose of those equity raises that we've done a bit earlier in 2025 were exclusively to address the need for the quarterly payments of the convertible bond, as Brian mentioned. These have been causing negative pressure on the share price. And we're -- as Brian mentioned as well, we're really happy with the renegotiation of that. As we always have been, we're focused on tight cash control, and we carefully allocate our cash very, very carefully into each of our programs. But in terms of any next steps, we're not giving any time lines. It would be inappropriate for us to state when and how until any deal is really agreed. Brian, do you have anything to add to that reply? Brian Hahn: What I can add here is the Board is not worried. You're aware, we're working on a number of options to fund our R&D programs. We have a number of levers, including partnerships, JVs, industry investments and/or equity funding. The data from pre|CISION is only improving. As Chris mentioned, we are seeing industry interest in our platform increase, and our business development activities continue. Christina Coughlin: Yes. Correct. Correct. Agree, Brian. We -- just to add to that, we are discussing both indications of faridox -- we're now using its new name, faridox, with a number of potential partners. There's a lot of interest as well in FAP-exatecan. But the company's strategy on that particular molecule remains -- we want to retain 100% ownership of this one. It's so close to the clinic. It's so close. And until it enters the clinic and delivers, we want to retain that 100%. It's been a decision made with the Board of Directors, and that is on track for the first quarter of 2026. And as you all know, we're quite energetic in our business development discussions. We have a range of potential partners, and it is a key focus of our financial strategy. The maturing data really factor into this, the maturing data in our clinical programs. And as we discussed in that last slide there, we are really approaching some key inflection points for the company coming up soon. Operator: Great. Well, let's stick to the subject, I guess, how much do you expect Phase II for faridoxorubicin to cost Avacta? How will you fund this if a partnership doesn't materialize? Christina Coughlin: So we're very confident in the maturing data in the Phase Ib of faridox. And we think that this will support the long-term value of this asset. Salivary gland cancer is high unmet need, and we continue to collect data in the various cohorts. We have committed that we won't start the further development activities in the absence of a partnership. However, as I've said, the maturing data set in Phase Ib is providing us with ample confidence that pre|CISION is working exactly as we designed it to work. The development in the expansion cohort is well underway. We believe the preliminary data here will provide that natural inflection point for the program. It's going to provide also clarity on accelerated approval pathways that we might be able to seek. And also, there's really an opportunity for the overall market to digest essentially the commercial potential for the program and the platform. As I mentioned, we'll have that pipeline update, platform update. And so we're really excited about the fourth quarter for the company. Operator: I guess we've been discussing imminent license deals and partnerships now for several months, but nothing has materialized. Can you comment on where you are with this? Christina Coughlin: Sure. It's completely understandable. We know that this is a recurring theme for our shareholders, and we appreciate the comments that we get here. I've already shared a lot as to our expectations here. But let me wax poetic on this a bit. We are in multiple conversations across multiple assets. The data in Phase Ib does continue to mature, which is really strengthening Avacta's position here. On timing, I can't give definitive answers, that wouldn't be appropriate. But what I can tell you though is that the team has a clear plan and we are executing on that plan. We have a number of touch points with a number of potential partners coming up. Our objective is really to exploit the potential of this technology for the benefit of patients and shareholders. And so whilst it may not be reflected in our share price today, these improving data sets, both clinical, but also on the preclinical side of things that we are seeing, these really strengthen the intrinsic value of our technology. We're looking to leverage this value for shareholders, and we will continue to update as we can on this particular topic. Operator: I guess a question really relevant to all those over 1,000 people that registered for today's call. Around the share price really, why does the share price still not reflect the value in today's pipeline? Christina Coughlin: Let me let Brian take that one. Brian Hahn: Biotech really follows a normal path. The only constant is good technology ends up with partnerships under buyouts. Avacta has a clear strategy, which it's executing, and we have shown in the clinic that our tech does what we designed it to do, concentrate the drug in the tumor while sparing healthy tissue from toxicity. Operator: That's great. Okay. Commercial strategy. I guess you have touched a bit on this throughout your presentation, but I wondered if you could just share a little bit more on your commercial strategy with those on the call. Christina Coughlin: Sure. So we've chatted before on this. And commercial strategy, to us, really reflects sort of 3 -- I think about it in 3 buckets. The first is our business development strategy, partnering deals, which we have touched on. As you noted, Mark, the long-term funding strategy for the company. And then also, one can think about the game plan for commercializing a drug. We do have the opportunity to commercialize both of our assets that have been disclosed, faridoxorubicin as well as FAP-exatecan. So let's think about each of these. So faridox, our lead program. We've successfully completed the Phase Ia. It has an excellent safety profile, encouraging PFS data in the salivary gland indication. And there's promising early signals in the ongoing Phase Ib that we continue to observe and continue to have those conversations with third parties. The development in the expansion cohorts, this is underway. The preliminary data is expected later this year, and it's going to provide sort of a natural inflection point for the program. It's going to provide clarity on accelerated approval pathways. And there's also an opportunity for the market to look at these carefully. For faridox, we anticipate releasing the initial data in salivary gland cancer late in 2025 and triple-negative cancer in the first half of 2026. Now our second asset, FAP-exatecan, this one is going to advance into clinical testing, and we anticipate initiating that trial in the first quarter of 2026, with the initial data available in late 2026. I have to be honest, I don't think that Avacta is given enough credit for how quickly, and the speed with which we have taken AVA6103 through preclinical testing and advanced straight to IND-enabling studies. I am extremely excited. If you haven't heard, I've nicknamed it the beast. But I'm very excited about seeing this one in humans for the first time. The new data that we shared today, or I should say, the updated experimental data, really speak to what this invention is and what we're seeing here with this particular drug. I'm so excited about this one. This is what my entire career has been about, novel breakthroughs in the fight on cancer. I've shared with many of you in my personal story here and like -- let's call it my personal vendetta against cancer. We've been asked quite a bit about this particular program. How does it work? And what is this new invention that we're talking about? And so I'm happy to tell you that we are bringing you an R&D spotlight tomorrow that will go -- it's a bit of a deeper dive into this particular asset and the sustained release mechanism. Now here in the office at Avacta, I've had the advice to tell everyone to have -- to pour a strong cup of tea. It is 23 minutes of the chemistry. We usually put a leash on our chemists, and they're unleashed in this one. It's not for the faint of heart. But aside from faridoxorubicin and FAP-exatecan in the pipeline, there's also the opportunity for us to develop a partnership with another oncology drug in a potential partner's pipeline. It would be inappropriate for me to say anything more on that at this time, but it is something that our business development team and our R&D team are really laser-focused on. And I will commit to you that we will continue to update shareholders as soon as we are able to do so. Operator: That's great, Chris. Well, let's switch gears a little bit and talk about R&D, I guess. In the salivary gland cancer data in late 2025, Q1 of 2026, the key inflection point, when will that read out? Christina Coughlin: So as you have seen, we can make periodic updates prior to the full salivary gland data set. We will reveal the entire data set as we have it in late 2025, late this year. And that data update, this is not the ESMO data. I want to be 100% transparent here. The ESMO data is going to be the dose escalation. That will be an update on the 11 patients that we saw the preliminary data at AACR. Late 2025, we're going to be looking at both the expansion cohorts, which are ongoing, as well as the dose escalation. So think about a larger data set in late 2025. We commit to hosting an investor meet regarding these data, and we will be hosting an investor meet right along with the ESMO data and then later in 2025 with the full data set as we have it, that will be released in the salivary gland cancer indication. Operator: What encouraging clinical activity has been observed in the AVA6000 Phase Ib trial? Christina Coughlin: So the initial clinical activity here in Phase Ib is encouraging, it's highly encouraging. It has increased the management team's confidence in the pre|CISION platform, the value, the utility. We look forward to sharing that later this year. But as I'm sure you can appreciate, we're not able to disclose further information at this time. The Phase Ia dose escalation at ESMO, I'll be in Berlin with Dr. Tap, who has been a long-standing supporter of the company and of the program, in October. We will be looking there at the longer-term cardiac safety data. The Phase Ib data, though, in that expansion cohort, will be at the end of 2025. And as well, the triple-negative breast cancer patient data in the first half of 2026. Operator: Okay. And maybe let's talk about AVA6103. What is the status of the AVA6103? Are you still on track to dose in Q1 of '26? Christina Coughlin: Yes. So 100%. We're happy to bring you that update today. FAP-exatecan remains on track. First quarter of 2026, it's those 3 areas that we're working on, manufacturing and the nonclinical program and then the clinicians, the clinicians in the company are quite busy. The initial data from FAP-exatecan, we anticipate late 2026 being able to make some early comments on the program. This program, again, I've called it the beast. It builds on the validated pre|CISION technology. It builds on that biopsy data, my favorite slide in the deck, as I always say. It builds on the ability of the pre|CISION platform to really concentrate the drug in the tumor microenvironment. Keep it as best we can out of the bloodstream. And what that does is it minimizes the toxicity, optimizes the efficacy. And we're very encouraged by the initial clinical activity showing how this platform works, and really excited to get the second one into the clinic. Operator: Great. And let's stick with AVA6103. You mentioned that the data had changed with the animal model of the [ FAPX ]. Since the previous data was released, why is this so important? Christina Coughlin: Yes, it's a great question. Why rehash this animal model that we already presented at AACR? It's one of the reasons that we do periodic updates on the clinical trial. It takes time for us to see survival durability. All of these endpoints take time to mature. Our animal models work in the exact same way as the patients. We have to continue to observe. And sometimes, it looks a lot better. If anyone wanted to pull up that exact figure from the AACR presentation, you'll see it was cut off with the data that we had at the time. And as we allow that animal model to mature, you can see that some of the lines end, so the vehicle-treated animals end. The exatecan, the conventional exatecan arm, that one ends as well because 3 doses is not enough of conventional exatecan, conventional chemotherapy. But what you can see in that new data is the tremendous durability of the responses with the FAP-exatecan molecule. This is exactly how we designed the sustained release mechanism. At the time that we still have responses in this animal model, we actually can't detect the exatecan anymore. And so it's active even at those really low doses is because it's such a potent drug. It's an important observation. It speaks to, frankly, what we're seeing in the early days of the salivary gland cancers, that we see this durability and sometimes the patients stay in responses even after we remove the drug. What we're pleasantly surprised at in this is that only 3 doses of FAP-exatecan lead to these kinds of responses. Again, I know I've said it before, this is exactly how we designed this drug, long and slow release of the payload, exatecan, which can then lead to these durable complete regressions. I've said it before, I can't wait to get this one into the clinic. Operator: That's great. Okay. Let's talk about shareholder communications and a number of questions around that. How is Avacta improving its shareholder communications? Christina Coughlin: Thanks for that one. First, I want to say, once again, Avacta greatly appreciates the support and the engagement of all of our shareholders. And we do take the feedback very seriously. We take it on board and we try and work better with it. Our approach is to really provide, what we think are informative deep dives into our progress, the clinical and the preclinical programs, and we try to do that at regular scheduled points through the calendar year when the need arises. We have investor engagement events such as this one. We have also listened to feedback from investors. So specifically at the AGM -- and we are responding to that. We will schedule investor meet presentations around every data release. And so I can commit to you that we will have an investor meet around the ESMO Congress. We will also have an investor meet later in October around that pipeline update. And then as we go deeper into this year, we will also host an investor meet around the data that will be released from the expansion cohorts. We heard that feedback, and we absolutely take that on. We're also going to commit to organizing live events. Shareholders have the opportunity to meet the management team, the scientists at Avacta, and to ask questions of us. We had a very good interaction at the AGM, and we will continue to build on that. Also, let me also mention that we have our regular R&D spotlight series videos that -- we put those on both the X platform and LinkedIn, and those will start to come through the investor meet as well. So you don't have to go to social media. That's another that we've heard. This is to educate on the pipeline. We have 2 new episodes coming up. The first is tomorrow, again, we're going to release that one with the sustained release mechanism explained. And then a bit later in October, we will have one of the R&D spotlights that really speaks to and speaks -- understanding of this new pipeline update. We're really excited to bring that one to you later in October. But what I also have to mention, though, is outside of these events, we can't respond directly to investor queries about the share price, matters that we can't discuss. These include, for example, our ongoing corporate opportunities, decisions being made, data that hasn't been released, clinical development progress, all of these. We would need to disclose these all transparently to the wider market. But we want everyone to rest assured, we will continue to engage. As part of these shareholder investment forums, we will look forward to R&D spotlight series. Tomorrow's episode is in direct response to a number of questions from shareholders about, can you really explain how this sustained release mechanism works? And so we commit to updating you via our public announcements when we have material news. Operator: Great. How does Avacta think about competing peptide drug conjugate platforms at Philogen and Bicycle? Christina Coughlin: Great question. So our pre|CISION platform has a couple of key differences compared to these other peptide drug conjugates. We often get this question from institutional investors. So let me take Bicycle first. The Bicycle peptide drug conjugates don't use a cleavable technology. That's one big difference between the pre|CISION platform and the Bicycle platform. The Bicycle peptide is designed to direct the payload to the tumor. And we think the reason that pre|CISION and this tumor-specific cleavage is so critical, in our mind, it's borne out in the clinic. We see a tenfold great -- back to my favorite slide, but we see a tenfold greater concentration of active payload in our biopsy samples compared with the published data from the Bicycle peptide. So while they see 10x concentration, we're seeing a median of a hundred-fold concentration. It was -- and I've mentioned this before, but it was really during a Board meeting when I saw those data for the first time, that I thought to myself, I'd really like to have a full-time role. I was just a nonexec at that point. But anyway, we also think that these data allow us to leverage much more potent payloads. That's why we can be bold and moved into the exatecan program. And then to take the second part of that one, it's similar, but the Philogen approach also uses a FAP cleavable linker, so much closer to the pre|CISION technology. However, they do substitute out the alanine residue. Remember, ours is an alanine, proline, and it's a post -- FAP is a post-proline cleaving enzymes. And so that substitution actually greatly reduces the specificity for FAP cleavage. So it will be cleavable by other post-proline cleaving enzymes. And so that reduces the specificity of the Philogen approach. And so we would predict that their results would be similar to the Bicycle. Lower specificity would mean lower concentration in the tumor micro environment, but also it could result in higher rates of toxicities because those cleavage points would be -- the cleavage would be not just specific in the tumor, but you could see more of those ADC-like toxicities there. Operator: There's a couple of questions around tariffs. I don't know how relevant this is, but what will U.S. tariffs on pharmaceuticals impact our clinical trials? Chris, can you hear us then? Christina Coughlin: Yes, I lost the audio there for a second. I don't know what happened, Mark. Operator: Sorry. No worries. Just a couple of questions on tariffs. Will U.S. tariffs have an impact on clinical trials? Christina Coughlin: Interesting question, especially as Brian and I hail from the States. But no, the tariffs are imposed currently on approved marketed drugs and those manufactured outside of the U.S. So since our programs are all pre-approval, the tariffs won't impact us. Operator: Great. Well, look, I think from a Q&A point of view, I'll submit all the questions to you. And if there's any topics that we haven't covered, Chris, we can always give clarity post today's call. But before I redirect investors to give their feedback. I wondered if you had any further comments before I redirect investors to give you some feedback? Christina Coughlin: Yes. So thanks for the opportunity. Avacta is in a very strong position. I hope you can hear from myself and Brian, we're super excited about the technology. We are executing on the goals that we've set for ourselves. We are seeing execution in our strategy, and everything is going according to plan. We're very much looking forward to the fourth quarter of this year. We're making great progress, and look forward to our next updates to shareholders, which include those data at ESMO, the pipeline update, which is a whole new way of thinking about the pre|CISION platform and how we can leverage that for the benefit of both patients and shareholders. We're moving our second program forward in the first quarter of next year. I've been quoted in saying programs are not children, so I'm allowed to have a favorite. The exatecan program is just -- it is sort of everything that we thought this platform could be, delivering a highly potent drug directly to the tumor, minimizing a lot of normal tissue exposure. It's exactly how pre|CISION was designed. So very excited for a number of updates that are coming over the next several months. And I'll be honest with you. I think that the future is very bright for this company. It is very bright. I've shared with many of you, as an oncologist, I gave many of these drugs in my clinical practice. I treated many teenagers with soft tissue sarcoma. I gave doxorubicin. What Avacta has been able to accomplish here is truly remarkable. And we are so excited to have a second program moving into the clinic. We're thrilled that the management team can now focus on delivery of pre|CISION as a pure-play biotech oncology company. And I'll say it again, the future is very bright for our company. And we're very grateful for our shareholders who have come along with us. This has been -- a dream of mine is to really impact cancer, and Avacta is doing it. So proud of all the scientists here, grateful to the sites, the clinical trial sites and very grateful, at the end of the day, to the patients who have signed up for our trials. I think we've got a very bright future in front of us. Operator: Chris, thank you very much indeed. Chris, Brian, thank you very much indeed for updating investors. If I could please ask investors not to close the session. We'll now automatically redirect you to the opportunity to provide your feedback in order that the company can better understand your views and expectations. This may take a couple of moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of the management team of Avacta Group plc, we'd like to thank you for attending today's presentation, and wish you all a good rest.
Ankur Crawford, Alger EVP, joins 'Closing Bell' to discuss if there's still fuel in the equity rally tank, stock valuations and much more.
U.S. stocks are drifting around their records on Thursday as technology stocks keep rising and as Wall Street keeps ignoring the shutdown of the U.S. government.
In prior shutdowns, the S&P 500 typically drops at first — then investors move on.
Investors are plowing more money into exchange-traded funds putting the industry on pace to rake in trillions.
Bullish sentiment increased 1.2 percentage points to 42.9%. Neutral sentiment decreased 1.1 percentage points to 17.9%.
Tech stocks and chip players continue to drive the market rally (^DJI, ^IXIC, ^GSPC), even as Wall Street shares concerns about a possible bubble forming due to AI oversaturation. Laffer Tengler Investments CEO and CIO Nancy Tengler comes on Market Catalysts to talk about where her firm is buying the dips in Big Tech, including her top stock picks in the mega-cap tech landscape.
Dan Veru, Palisade Capital Management senior partner and CIO, joins 'Power Lunch' to discuss the opportunities available in small cap stocks.
CNBC's Rick Santelli reports on the latest news regarding bond markets.