Carclo plc (CAR.L) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and welcome to the Carclo plc interim results investor presentation. [Operator Instructions] The company may not be in a position to answer every question received during today's meeting. However, the company review all questions submitted today and where appropriate publish responses. This will be available via your Investor Meet company dashboard. and we'll notify you by e-mail when they're ready for your review. I'd also like to remind you that this presentation is being recorded. Before we begin, we'd like to submit the following poll. And if you could give that your kind of attention, I'm sure the company will be most grateful to have your response. And I'd now like to hand over to Phil White, CFO; and Nick Sanders, CEO from Carclo. Good afternoon.

Good afternoon, everybody. It's Nick Sanders here. Thanks for joining us, and now, it's good to have people looking again to hear our latest update. So I think you know what Phil and I look like. So we'll move on to the presentation itself. So what we're going to do is just give you an overview of the first half trading, Phil will go into more detail on the financials. And then I'll round it up with our summary and what we think about the second half in particular. And then, of course, we'll look forward to doing your Q&A at the end. So I look forward to an active participation with you all. Last time we did this, it was a great reaction. And hopefully, you'll find this update equally as useful. So when I talked to you last time, we talked about creating a stable platform and moving into a growth phase. And I think you can see that in the first half of this financial year, we've started to achieve that. You'll see a healthy sales growth, up 17.5% from the prior period. And with that underlying operating profits more than doubled, and that's before any one-off benefits that we've had. We have had a couple of one-offs in the first half. We had a U.S. government grant, which was initially a loan and then got converted into a full grant with no recourse, which allowed us to take that to profit, that's GBP 2.1 million. We've got a further disbursement from the Wipac administration. And also, we've got a deferred tax credit as well. So they're all one-offs that helped the result. But really, the underlying picture itself is pretty strong. Net cash inflow [indiscernible] outflow. I guess the only thing that's held us back in the first half is holding more inventory because of the headwinds that we're facing in the market. And I'll tell you about those in a minute or 2. But nonetheless, we're generating cash even with our obligations on pension contributions and debt repayments to our banks. As you can see, net debt did reduce by about GBP 1 million. And really importantly, we've seen a reduction in the pension deficit. And if you look at this in 2 ways, from a year ago, the pension deficit on an IAS19 basis, has reduced from GBP 58 million to GBP 33 million. And we'll explain the factors that have gone into that. But really, just in the last 6 months, we've seen it reduce by another nearly GBP 4 million through a combination of the contributions that the company is making but a stronger asset investment performance as well. And I think we're pleased with the work that we're doing with the pension trustees and the pension trustees are doing in terms of actively managing the pension fund for the benefit of everybody involved. And key to our growth -- our growth strategy is to organically grow in our chosen markets, particularly medical, diagnostic, aerospace and that requires CapEx, and we have made significant CapEx investments over the first half, and we'll continue to do that over the next 2 or 3 years, actually, as we execute on our strategies of becoming a more of a global player in the markets that we're already in. So when we look at that, we feel that's a pretty strong performance in the first half. We think the second half will probably be a bit tougher in terms of margins because of all the things that you will be all aware of in the marketplace, I'll tell you about those in a minute or 2 in more detail. But we do believe, overall, we're going to come in better than the expectation that has been published by the analysts. So moving on, when you look at CTP, our biggest division, 95% of our group turnover. We're continuing to win new business, particularly in the medical and diagnostic sector, which is great to see. We have a roster of very high-quality customers. We've got new customers coming on board as well, and existing customers are continuing to invest with us. And that's been particularly evident in the strong tooling order intake. So we've seen a very strong order intake in the first half predominantly from one customer who has really made a very long-term signal of their intention and their support for us as a business by placing very large tooling orders for us. And that's good for us because tooling orders generally presage product sales. Now some of these orders are for replacement tooling but also base for new product as well. So we think that bodes really well for the future. I think the business CTP has done really well despite the strong headwinds that I've mentioned a couple of times already, and specifically for us, what that's meant is a shortage of labor, particularly in the U.S. And we've had to work really hard to recruit people in the U.S. and also to pay higher salary rates. We've seen increased raw material prices, no surprises there, and also energy costs are continuing to go up as well. And logistics lead times and costs are all increasing. So it's been a highly unusual period for us where you've seen such big movements in all of those things. But that's the way the market is. And of course, everybody who operates in this market has got pretty much the same pressures. But we have worked hard to mitigate the impact of those. We've worked hard at recruitment. We've had to increase pay. But equally, we also increased prices to our customers in a way that seems fair to us to try and offset some of these headwinds. And also as well, we're holding more inventory to protect customer deliveries. We found particularly 2 or 3 months ago, getting hold of raw material was really hard. So we've taken the decision to hold about GBP 3.5 million more inventory than we would generally do. But we expect that to burn off as supply chain start to stabilize as we expect them to slowly start doing in the second half. Aerospace is a smaller business, of course, but maintained its record of being profitable even in the tough times. We do see the market starting to recover slowly. We've seen order intake in the first half exceed sales, which is a good sign. And there's a lot of very strong messages from Airbus, from Boeing about build rates on 737s and A320s, which will feed through into our order book at some point. But the orders that we've seen so far have been the return of existing customers, some spares, but also some new customers as well, which is a really good sign. And we're focusing our organization not just on winning back the business that we had before, but growing the business into new parts of the aerospace sector, where we think we can be competitive. And we're strengthening our business development resource there because it's a very good margin business, and we think we can grow quite nicely there as well. So good news, I think, to report on both of the operating divisions. And at the same time, equally, we've kept a real close handle on the central cost as well, and you'll see that we've managed to keep central costs down. When Phil and I joined the business, we said that what we would do is make sure that the central costs were kept to a minimum and the divisions were made to be stand-alone, and we're progressing well on that journey and giving the divisions, the autonomy to operate and to grow. So Phil, at this stage, I'll hand over to you, and if you can talk everybody through the results, and then I'll talk to you at the end and summarize where we are. So over to you, Phil, please.

Thanks very much, indeed, Nick. Hello, everybody. I'm Phil White, CFO for Carclo, and we may have met before and welcome you all today. Thanks for joining us. So we're just going to go through the key features for the interim results. So most of you will have seen these already, but picking the main ones out, Nick's already highlighted that we've got a good healthy revenue up by 17.5%. That's GBP 8.7 million. And we're saying that's despite the COVID-19 headwinds, which we've experienced, particularly, I would say, in the second half of H2 more than the first half. Underlying operating profit has been very healthy at GBP 3.7 million, over double where we were at the same time in H1 for September [indiscernible] that's a 141% increase. And again, that's basically a byproduct of the volume increase, and we'll go into this in a bit more detail, but we've also managed to head off a lot of the impact of the increased costs of post COVID and supply chain difficulties with an improved product mix and also the countermeasures that we've taken. The statutory operating profit then has reached GBP 5.8 million. Nick has already highlighted some of the particularly separately disclosed items in there, which we'll go back into. And that gives us an underlying EPS of 2.5p on the underlying operating profit and the statutory profit after tax of GBP 5.5 million. So that's reversing a loss of GBP 1.1 million in the previous period. And again, we'll go into this, but we're very proud to be able to say that we've managed to avoid any exceptional costs in the half year. And we've taken post COVID costs to the operating profit. Underlying earnings per share then 2.5p and basic earnings share -- earnings per share with the one-off benefits there of 7.5p, which we'll go into in more detail. If we look at the operating profit as a visual then in terms of the bridge, where do those improvements come from going from the GBP 1.5 million to the GBP 3.7 million, mainly technical plastics that -- this is predominantly our largest part of the business, a good 95% of the business. Aerospace, which everybody will be aware, has been very heavily impacted by COVID. We're quite pleased in a way that we managed to mitigate the damage to the half year results to just GBP 0.3 million on reduced volumes. And central costs, we've managed to improve by GBP 0.9 million. And I can see there's a question from [ Matthew G. ] on that just in terms of what are the components. We've managed to and target a whole range of issues there in Central. Nick's already mentioned that we have now effectively divisionalized our operations so that we have a very small central office and we do what the main things are, which is to coordinate, plan and lead strategy and make sure that we maintain very strong governance throughout the group, but our general activities and responsibilities are divisionalized. As a result, we managed to reduce our legal and professional costs. We've reduced our staff costs. And we've also managed to allocate our charges centrally a little bit more to the divisions where they're not really applicable to the center. So overall, that's been a good result. In terms of the balance sheet and cash. The net cash from operating activities has also improved from an outflow net of GBP 0.5 million last period to GBP 0.6 million and the net debt has also been reduced, and that was basically all committed on the refinancing of the group in August 2020, whereby we've already published that there'd be a series of repayments across to the principal bank, and we're halfway through that program now and that finishes next September. And net debt, including leasing liabilities, that has also improved period-on-period by GBP 1 million. And then out of that, the net assets makeup is GBP 17.1 million. So we're seeing quite a dramatic improvement on net assets from GBP 13.3 million negative to GBP 17.1 million. So I'll go into that in a bit more detail. We've invested in CapEx, a lot more significantly and now at a good run rate there of GBP 3.5 million, whereby in the previous period, it was more reduced and limited in scope at GBP 0.8 million. So we're happy that CapEx is now at a good investment level for our future growth. And the retirement benefit obligations, the pension scheme deficit, which is based on the IAS19 accounting rules that dramatically reduced since the previous first half of the year from GBP 58 million to GBP 33 million. And the main gains there were both a combination of assumptions on the discount rates, which have changed from 1.5% in the previous year to 2%. And there's also improvements in asset returns and experience of obligations and also mortality. In terms of the retirement obligations for 6 months and what has changed in the last 6 months, we'll go into that in a bit more detail on the chart, and I'll take you through those details. The net assets, as I say, is now reversed as a combination of both the improvement on the retirement benefit obligations and the combination of statutory profits, we've got over GBP 30 million turnaround in the balance sheet. So we're entering the second half of the year with a much stronger and positive balance sheet. If we look at the movements on the group net debt and take them one by one, starting with the main generator of the net debt change, the underlying EBITDA of GBP 6.9 million. And then we have working capital outflows. At the beginning of the year, we were expecting that to be more neutral. But because of the COVID supply chain, we've tactically and strategically invested more in inventory to protect the supply chain and make sure that as little damage is done as possible on delays in service and make sure that we're still efficiently running where we've had delays in particularly raw material supplies on occasion. So that is a bit unusual. The working capital outflow, we wouldn't expect that to maintain itself over a longer period of time. The net interest paid is the finance costs and the tax paid is a fairly normal level. And the pension contributions are net of the expenses, which we contribute there. Then in terms of the COVID-related U.S. government loan, Nick has already mentioned that, that was converted from a loan that was received by the U.S.A in April '20. So it's their version of furlough payments effectively, which came all in one lump sum. That was held as a loan at the end of the last financial year. That's now been converted and forgiven by the U.S. government in May this year and therefore is released into profit and is separately disclosed on the face of the income statement with it being a material amount. Nick has also mentioned the discontinued business proceeds of GBP 0.7 million. So we're completely out of that business now, and that was the residual proceeds from the administrators distribution. And then finally, in terms of the outflows, we've invested GBP 3.5 million in CapEx, leasing of GBP 0.2 million and foreign exchange differences of GBP 0.5 million. So that's what the movement of GBP 0.8 million net debt comprises. Going back to the retirement obligations. Over the last 6 months, what has the movement been? We've had another improvement of GBP 3.9 million. None of that is based on changes in key assumptions, the same assumptions, which drive the criteria for evaluation in March have also been used in September. This awaits a more significant juncture of the triennial actuarial valuation for 2021, which was undertaken in -- at the end of March '21, and the results are awaited for that and will be published in time for the final accounts in March -- at year ended March and published in June '22. So in terms of the development of the IAS19 deficit, we see interest charges and admin charges there. And then the company contributions, which increased under the agreement made in August 2020 with the pension trustees and tripartite with the bank, their enhanced contributions, which net -- which are GBP 2.1 million gross and then we've got change in financial assumptions, which is negative, but a much more positive asset return. And within the asset returns, we have a great degree of hedging in the liabilities that -- and obligations. So we have hedging instruments within the asset portfolio, which helps to maintain a balance between asset returns and obligations. So the overall change is an improvement of GBP 3.9 million, and that is without any significant changes in assumptions. They will be seen when we complete the year-end accounts. Going back to CTP, then as we call it, technical plastics for Carclo, strong revenue growth, nearly 20% and some good new business in the -- the product sales are up 15.6%. And Nick's already mentioned that in terms of the tooling income, that's significantly up from GBP 6.1 million to GBP 9.1 million. And the tooling sales, as Nick referred to, can often mean that you are starting to get a better product sales pipeline as well. Underlying operating margins as a result, they're up from 6.8% to 8.5% of sales. And there, we've got both an improved margin mix. We've also got price increases have been passed on where possible to customers, not in all cases. Where it's not possible contractually, they're gradually being negotiated where we can, but it's helped us to mitigate the supply chain cost increases. And overall, we've seen quite a healthy operating profit margin improvement. In terms of the second half of the year, we expect improvements again in the sales revenue underlying margin, probably slightly lower than H1, slightly a bit more affected because what Nick mentioned earlier is that the post-COVID supply chain effects have come more, I would say, midway in the first half of the period. So we're good in our loans for a second half of the financial year, where a lot of these impacts will continue. In aerospace, we've managed to contain any impact of COVID down to GBP 0.3 million decrease in the operating profit on lower sales income. I think the most encouraging thing now is that we are seeing orders pick up and orders have now in cumulative terms, improved over the sales level. So that's quite an important turning point in the Aerospace division. And as a result, we're basically saying it's still generating cash and the order pipeline is starting to look better and improving with some good initiatives under the way and some careful investment in the growth of the division.

Okay. Thank you, Phil. So that provides a bit more of the detail of the key elements of the first half performance. But as a Board, we think that the first half performance has been really quite good despite all of the headwinds that the business has faced and industries faced in general. As Phil just said, we expect really these headwinds to last through the second half. There are some early signs that perhaps raw material prices have peaked, but energy prices are still going up. So we've been a little bit cautious in the way we look at the second half. And particularly as we look at margins, I think it would be a little bit down on the first half. But nonetheless, we still expect that for the year, the operating profits will come in slightly ahead of the expectations, and that's before the effect of the one-off benefits that we outlined earlier on in the presentation. So we do expect to come in ahead of the analysts' predictions. We will continue to invest in CapEx for future growth. That's the model we're on. We know that there are great opportunities to grow our business globally, but particularly in the parts of the world where we've got capacity readily there, floor space to grow in and that's particularly in Asia where we see, again, great opportunities for growth. So we'll continue to invest in the CapEx on that. And I think generally as a business, we feel encouraged by the progress that has been made. It feels a different business from the one it was 18 months ago. And there's definitely that feel of stability and excitement about the future because we really can see these growth opportunities. But we're just going to keep doing what we're doing, keep a tight lid on the costs, center keep working with the working capital and invest the money that we're making and the CapEx into growth opportunities for the future. So hopefully, you found that an interesting updates. And so we'll now move on to the Q&A section. And I think we'll start off. We have a couple of questions logged by Mark [indiscernible] going to read out.

Yes. Let me just jump in just to give you a few moments of the break. [Operator Instructions] But I just want Nick and Phil take a few moments to review those investor questions submitted already. I'd like to remind you that a recording of this presentation along with a copy of the slides and the published Q&A will be available via your Investor Meet company dashboard. You'll get an e-mail from us notifying you when that's ready for your review. I'd also like to remind you that your feedback is important to the company and immediately after this presentations end, we'll redirect you in order that you can provide the company with your thoughts, views and expectations. Nick, as you quite rightly stated that investors had the ability to presubmit the questions. We received 2. So perhaps I could start the Q&A off with these. The first 1 reads as follows. How much does the company anticipate the increase in tooling income will translate into subsequent product sales going forward based on your previous experience?

Okay. It's always a difficult one, and Phil will jump in with some more detail on this. But the orders that we've received for tooling, some of them are for immediate upgrades to existing tooling. So they replace tools that we've already got some of its existing product. But some of the orders will last over the next couple of years. So we'll see -- expect to see that tooling investment turning into revenue more in the out years than in this year. But Phil, do you want to just comment on what the drop-through to be?

Yes, sure, Nick. So yes, if we look at the recent ratios of tooling income to CTP product sales, and as you say, they're not exactly a very specific sign or ratio, but it can give you a trend. They've increased encouragingly from 9.5 percentage points we calculate in the year to March 2020. That's GBP 9 million over GBP 94.1 million to 16.2% in the year to March 2021. That's GBP 14.3 million over GBP 88.2 million. And then if we look at half year, you again see an improvement in that ratio of tooling sales to product sales. So for instance, the first half of September '20 was an increase of 14.8%. That's GBP 6.1 million over GBP 41.1 million. And that same ratio had increased from 14.8% to 19.1% in the latest half year results with GBP 9.1 million over GBP 47.5 million. And picking up, I think there's a question within -- from [ Alexandra ] within current assets, why is the contract assets up to 6.1 versus 3.5 last year. When we get tooling income, what you tend to get is deferred expenditure and deferred income within the contract assets and contract liabilities. So a lot of the contract assets and liabilities actually reflect what's going on in the tooling world because you'll start to get a capitalization in the balance sheet of work in progress. So the increase in assets up to 6.1 is also reflective of increased volume in tooling activity.

Just jumping on to the second pre-submitted question reads as follows. In regard to the reduction of the pension deficit, could you expand upon the initiatives progressed with the trustees?

Yes, I think, we have probably touched on. We've shown you the breakdown of where the reduction has come from. But Phil, do you want to talk about BPO and a couple of other things.

Yes, sure. So I mean, there's a few things still in the pipeline, so I can't really go into great detail. But I think if we take the bridging pension option, which we just completed before the year end in March '21, basically, what that did was allow members options of earlier commutation of pension benefits and that provides more flexibility for members and reduces projected liability commitments for the scheme. So as a result, you get in a win-win situation, members get more flexibility. They're allowed to do more things with the pension parts. And it also takes pressure off the obligations of the scheme because they're all about the actuaries and the accounting rules are all about projecting what those obligations would be over, say, can be around 20 years for the remainder of an average member's life. So the more flexibility they've got for commutation, then you tend to reduce the obligation. So that had quite a significant effect in March and beneficial to the obligations for the scheme in the business. And we're looking at similar things as well now where, again, we're taking a bit of the pressure off the obligations, but not in any way diluting members benefits. That would not be done. But what we do offer is more flexibility. And we've got a few initiatives in the pipeline for the new year, which will improve on that and again, get more efficiency over the management of our pension schemes.

I think I would add to that, that I think credit to the pension trustees who've taken a really active approach to, I think, of benefits for members, investment strategies and working with us very collaboratively. So I think a lot of that is good encouraging stuff for the future. So we want to keep that going.

That's great, Nick. That takes out the presubmitted questions. Obviously, you received a great deal of questions throughout today's presentation. So thank you to all those investors that have submitted questions. I would like to, if I may hand back to read out the questions importantly and give response where it's appropriate to do so, and I'll pick up you at the end.

Thank you. Thanks, Mark. So we have had a lot of questions and time is not going to allow us, unfortunately, to answer all of those. And some of them are a bit too detailed to answer on a call like this just in terms of the detail and what it might say about forward-looking statements, but let me pick up on 2 or 3. So it's a question from [ Mark Henn. ] Are our diagnostics customers predominantly U.K.-based or further afield? And how do you foresee this panning out in the longer term particularly regarding plastics and tooling for lateral flow devices. I think our customers are, in general, large multinationals, and they operate in many different countries. So a very few of them are actually U.K. based. They've got U.K. divisions. So they really are blue chip global customers, their investment also, they look at it on a global basis, they tend not to look at, well, I am going to invest in the U.S. or the U.K. or India, they look at Carclo now more as a global player, which is what we wanted. Most of the investment in tooling for lateral flow devices has already happened actually. So we think that lateral -- demand for lateral flow test will continue for a while yet, but there is so much innovation in the medical and diagnostic sectors in non-COVID fields as well. And a lot of that is driving development, particularly around things like diabetes treatments and things like that. So our product range in medical and diagnostics is not overly exposed to COVID or lateral flow tests in particular. Hopefully, that answers that one. Let me pick up on another one. [ Chris Lee ] said central costs were high during reorganizations, but are only about 25% lower in H1, will it drop significantly next half? I don't think so. I think we are at a point now where we've taken the cost out that we can at the center. As Phil said, we're keeping a very tight control of our external spend, and we're running with a very minimal staff. The one thing that we have had to invest in at the center, which is a higher cost this year is IT. And we found that we wanted to improve the IT, particularly cybersecurity. And so actually, our cost in that element of the center are up from last year. So, no, I don't anticipate there'll be significant further drops in that. So I think we've already done that. [ Henry C ] asked about, is there a rule of thumb what sort of future revenues to expect from tooling orders and I think Phil answered on that one? Great to see share purchases by directors. Thank you. We believe in the business and happy to invest our own cash in this as well. [ Jonathan H, ] is your balance sheet constraining your ability to invest. If so, how can you address those constraints? I would say in the short term, no. But we are looking at all number of mechanisms by which we can have more access to capital to allow us to invest in the CapEx that we want to, to support the organic growth model. We do have a very -- pretty hard -- pretty full-on strategy to grow, particularly CTP organically, and that will require investment. But we're not constrained at the moment. And we think that we can undertake a number of different activities, which will give us the headroom in the balance sheet that were required when we get to the stage of needing to spend bigger sums. So it's going to be a careful balancing act for us. We haven't got -- given the history of the business, we don't start with the balance sheet with a massive amount of headroom. But you can see we've managed to fund well the increase in CapEx so far and at the same time, reduce debt and at the same time, get a pension deficit reduction. So I think it will be an area where we'll continue to focus. [ Christopher F. Nick's underspoke ] of support from a single customer in helping to retool, can I ask if they are shareholders as well as customers. No, they're not. And what share of sales does this customer have? They are 1 of our bigger customers, and they have more than 20% of our sales. So they are a big customer. [ Alexander W, ] regarding pensions, you mentioned in September that further initiatives are being developed with the pension trustees to aim to improve the pension schemes, any insights that you can provide on this? I think that Phil has probably covered as much as we can at this stage. But as I say, as time goes on, we can share more of the things that the trustees are doing and that we are working on the trustees with. But there are quite a few things that we're just not able to talk about openly just yet, but we'll reveal more as we -- as time goes on. [ Frank C, ] how are the company progressing the framework agreement signed December '20? Well, I think. That is again for another big blue-chip customer. It involved putting new manufacturing lines in the U.K. and the U.S. The U.K. is now fully operational. The U.S. one will be online very shortly. So we've made the CapEx investment, I think the company -- the customer is happy with what they're seeing with us. It was one of the biggest projects we've had to undertake as a business. And I think as we can see as time goes on, we'll have more big projects like this to implement and so I was really encouraged by the fact that the team, project manage, time scales, costs, and also the quality of what we were delivering very well. So we're not fully in production yet in the U.S., as I said, but I think we're not far away from that now. [ Frank C, ] another question, is the company taking steps to reduce its reliance on 1 particular company? Actually, the company customer diversification base is pretty good anyway. Our biggest customer doesn't have an overwhelming majority. And with the new business, particularly the contract we're just talking about that introduces another very big blue-chip customer to our customer portfolio. So I don't feel overly concerned about customer concentration and particularly with the new work that we're winning, we'll -- I think we'll have a very broad roster of big blue-chip companies, which is encouraging. What does the company think about the recent share price volatility, another one from Frank. Well, all we know is why our results are -- the market tends to do what it wants to do with those results. We -- I'll be honest, I was disappointed by the reaction of the market to the announcement on -- that we put out on Friday, I thought it was a pretty good set of results. Logically, I would have thought that would have increased the share price, but it didn't. But it's a long game. I'm not unduly concerned about it. The market will form its views of the value in the business. But I think me and my fellow directors have indicated our view on what the -- where the value in the business is, and we're putting our own money in to reinforce that point. I'm just scanning up to see if there's any others that we haven't covered. Phil, are there any others you would pick up on that you can see on the list that you can...

So that fixed and variable costs with CTP, I mean we don't really publish account detail on variable and fixed costs. But I think we would say probably a fairly obvious there, which is when we get increases in volume, then we do save on the fixed cost element. And as a general rule of thumb, you would expect volume improvements to be semi variable in overall benefit. Nick, I think, is fair to say.

Yes.

So we saw, I think, by memory, in terms of our volume improvement, I think 25% came through to the bottom line on the underlying profit. And that's a combination of both central costs and divisional improvement. So we were very pleased with that 25%. I mean you would normally be thinking from a divisional basis, and I would say the divisional improvement there was 15% and I think 10% from the central cost improvement. So overall, that suggests a fairly semi-variable relationship.

Okay. I think that probably represents all the questions that we can answer at this stage. Some of the questions are unfortunately just a bit too detailed to answer in a forum like this, but we do appreciate everybody's interest in the business. So I think, Mark, that sort of does this for today, I think.

Absolutely perfect. And thank you once again to everybody that submitted questions today. And of course, Nick, Phil, we will make every question available just in case anything else comes through in the meantime. I know investor feedback is important to you guys, and I'll shortly redirect investors to provide you with their thoughts and expectations, but I guess before doing so, Nick, I wonder if I could hand back to you just for a few closing comments to wrap up with.

Yes. Thank you. As we said when we did the -- our first presentation using the Investor Meets Company Forum that Carclo was on a journey, I think we're showing that we're making real progress there. There really is good traction coming through the business. I think even with the headwinds that we've faced, we've produced a very strong set of results and we're very optimistic for the future. So thank you all for your support. We do appreciate it. And hopefully, we'll look forward to talking to you again not before too long with further updates on the business.

That's great. Nick, Phil. Thank you once again for updating investors this afternoon. Can I please ask investors not to close the session as we'll now automatically redirect you for the order for you to provide your feedback in order that the company can better understand your views and expectations. This only take a few moments to complete, but I'm sure it will be greatly valued and welcomed by the company. On behalf of the management team at Carclo plc, we'd like to thank you for attending today's presentation. That now concludes today's session. Good afternoon to you all.