Pennant International Group plc (PEN) Earnings Call Transcript & Summary

Good morning, everyone, and thank you for joining the Pennant International Group results presentation. Before we begin, we would like to submit the following poll, which you will see on your screens. [Operator Instructions] The company may not be able to answer every question it receives during the presentation. However, the company will review all questions submitted today and publish responses where appropriate. These will be available via your Investor Meet Company dashboard. Finally, we'd like to remind you that this presentation is being recorded. I would now like to hand over to Philip Walker, Chief Executive; and Darren Wiggins, Chief Financial Officer.

Good morning, everyone, and thank you for joining us today. As Tom said, I'm Phil Walker, I'm the Chief Financial Executive Officer, used to be CFO of Pennant International Group. I'm joined today by Darren Wiggins, our CFO.

[indiscernible] Good morning, everybody.

Today, we're going to cover 4 sections. I'm going to give you a brief overview of Pennant. I won't dwell on it a lot because hopefully, people on this call have heard the story before, but I'll give a quick refresher on who we are and what we do. I'm then going to look forward to providing an update on our progress against our strategic objectives, which we set out earlier this year. I'll then hand over to Darren, who will take you through the detailed financial performance for the first 6 months, and then we'll finish up with looking at the outlook, the prospects of the business and then Q&A. So without further ado, let's get cracking on. So Pennant, Pennant today is fundamentally a different business from the one that existed several years ago. We've been on a journey to transform this business away from its legacy engineered harbor towards a software and services business. And I'm pleased to say we've made good progress over the last period to deliver that. Everything we do at Pennant now is focused on maximizing operational capability. What does that mean? That means readiness, minimizing downtime, maximizing uptime, all the buzzwords you hear in the press. It's something we've done for some time, has become prevalent in the world we operate, particularly in the defense sector. We operate globally. We are truly an international company with revenues across the world and offices in the U.S.A., Canada, Australia and the U.K. And our mission is very simple. How do we ensure that mission-critical assets and systems are available where they're needed, when they're needed and that they work. We take away one thing from this today, the key characteristics of Pennant and our model is now increasing the level of recurring and repeatable revenues generated from our software and services, creating a predictable and sustainable business that can scale and grow. So how do we do that? I'll hand over to Darren now, who will take you through how we operate.

Okay. As most of you will already know, we go to market through 3 operating segments. First, on the left-hand side of the chart here, we have the sale of our proprietary Auxilium IPS software products, which we'll talk through in a little more detail later in this presentation. This particular segment is expected to deliver circa GBP 3 million of sales in full year 2026 at gross profit margins in excess of 85%. Looking back, in 2024, we introduced a new subscription pricing model. And since then, the majority of our license sales have been under the subscription model. We ensure that all customer purchases are paid for in advance before or ahead of the access to the licensed product. And I'm going to jump around a little bit here. Secondly, on the right-hand side of the chart is our heritage. It's our Training Systems and Solutions segment. Over almost 70 years, we've designed and engineered hardware, software and now virtual solutions to replicate maintenance and operational practices for end users in the defense sector, helping to ensure, as Phil alluded to earlier, the equipment is used effectively in the field. Again, looking back to last year, after receiving over $10 million in orders over the previous 12 months, this segment is expected to deliver circa GBP 5 million of sales revenue in FY '26 at gross profit margins in excess of 50% -- most of the activity in this segment is project-based and as such, we recognize revenue on a percentage of completion basis. Working capital cycles are longer, and we ensure that contracts are agreed such that milestones keep receipts ahead of payments at any given stage of delivery. And then finally, in the center, there's a reason why arrows are pointing inwards here, our technical service operations because almost all of our service contracts derive from the original sale of Auxilium software or training equipment. We have teams of experts across all 3 operational footprints in the U.K., Canada and Australia, helping our customers to use our products more effectively. This segment is expected to deliver at least GBP 5 million of sales revenue in FY '26 at gross margins in excess of 35% -- as we recontract some of our long-term services, we're focused on the improvement of margins to ensure that we are paid for the significant value that we offer. Revenue is recognized and invoiced as services are delivered. And then finally, as the banner across the software and the Services segment suggests the revenues from these combined segments is seen as recurring in the case of software and repeatable for the majority of services as a result of being on the long-term contracts.

Thanks, Darren. So I'd just like to take a moment to talk about routes to market. Traditionally, Pennant has been a direct-to-market business with all of our orders coming from relationships that we've established ourselves. We're very fortunate at Pennant that we benefit from a very high-quality customer base. That includes, as you can see on that slide, Australia Defense, Canadian Defense and a number of main prime contractors such as Rymantel, Boeing BA Systems. The most important point to take away from that left-hand part of the slide is the fact that we see substantial expansion within those existing customers alongside the development of the channel partners and technology partners. With the launch of the integrated suite in Q2 this year, we've now got a capability that increases our stickiness with this customer base and will allow us to grow our wallet share. And as we move away from project-based tool into more of an enterprise-type system, we see significant growth in that customer base. But alongside that and as part of our strategy, and we've talked about on these calls before, is how we're trying to grow our indirect channels and our partners. I see in the chat already in the questions, there's been a number of questions raised about Siemens. And just to talk about in the context on this slide, -- we first engaged with Siemens over 2 years ago as a potential partner. They were looking at a make-buy decision to establish whether they should develop a capability or should partner with someone to acquire someone. I'm pleased to say in July '25, we won that competition with Siemens against stiff competition from U.S. primes, and we've been on a journey for the last 12 months to get onboarded with our partner. That's culminated with the first sale of our products in June this year, followed quickly by the second sale. Now this has taken a lot longer to get to market than we expected, but actually the potential in this is significant in the sense that Siemens have over 300 account managers, over 17 product managers, and we spent a lot of time over the last 12 months doing a number of things. One, we've been training the product managers and educating the account managers. Two, we had to improve our support systems, our licensing platform, our security and three, the access that Siemens have to market, particularly in U.S. defense is something that we can -- we would not establish a small SME in the U.K. All that's culminated in the fact that Siemens are now starting to show momentum, releasing blogs, launching a marketing campaign, including the price list. It's still early days in terms of this relationship, but we've got high hopes that this will form part of our core strategy going forward alongside others. I'd also like to point back to one point on there as a technology partner. We announced a new capability in May this year, working with OnePoint to create a services capability called ConvertWise, which takes legacy data and brings it into a digital system. Having launched that, we've already won 2 or 3 contracts now to actually provide that capability. And this is the strategy for this business going forward, expand the customer base we have in terms of direct channels, increase our market share, continue to work with our technology partners to access new markets, bring new capability and in the middle there, establish a series of channel partners in markets and territories such as South Korea, Japan, India, where language, culture, distance is a challenge for us to allow us to scale and put some real horsepower behind the Ox product suite. We'll come back to, I'm sure in Q&A at the end, but I just want to take the opportunity to give a bit of color around Siemens. So moving on, what have we done? What is the first 6 months of '26 meant for Pennant as a group? I think the first thing I'd say is that it's been a solid performance. And I think the first half results, which hopefully you've all seen this morning, demonstrates that our plan is delivering. just like to pull out a couple of points on here. Number one, adjusted EBITDA from a GBP 1.1 million loss to GBP 0.5 million profit. That's a significant turnaround and shows the momentum we're starting to build in the business. Secondly, and one I'm personally very proud is our operational delivery. We secured important contracts with Canadian D&D, launched the Auxilium integrated solution, launched our new pubs capability, and we continue to deliver key milestones on all contracts, which is a testament to the team and the people at Pennant delivering. And the final thing I'd like to say is as we look forward to the end of this year, '26, over 95% coverage of revenue for expectations. We're confident in meeting expectations this year. And looking forward beyond that, we're looking forward to delivering '27 and beyond with over 80% coverage for '27. So as I stand here today or sit today in front of you all, I'm really pleased with the solid progress we made and feel very confident what the next 6, 12 months means for this business. I'd just like to take a moment to look back and say, what did we say we're going to do and how are we performing. So in January this year, as a Board, we put out some 3-year strategic targets. These were the objectives the business set itself between '25 and '28. Hopefully, you've all seen them or if you haven't, take a moment to have a look at these. We -- these were all geared around growing recurring repeatable revenues, improving operating margins, generating stronger cash flows and effectively moving towards a scalable business. The progress in the first half has provided me with evidence that this plan is working. So what I'd like to do is talk you through now the commitments we made and how we're getting on by segment for each of these areas. Before I do that, just a reminder what those commitments were. So when Darren and I sat in front of everyone in the interims or the full year results in March, April, we talked through these aspirations for each of the segments. These are the commitments we made, we will look to achieve in 2026. So without further ado, let us show you how we're doing against each of these areas in each segment. Auxilium, solid progress. I'll come back to AR in a minute, but just to remind you what it is for those before. Auxilium now is the cornerstone of our software and services strategy. The platform brings together our 3 applications, which Genus, analyzer -- right into one holistic solution for our users. The tool enables our customers to manage complex technical information, knowledge, operational data, data efficiency, all in one single source of truth and most critically, what allows data-driven decisions. In the current environment, those decisions are vital for operational readiness and availability. It ensures it delivers our mission. It ensures those systems are available when they're needed, when they needed and they work. And that's becoming more apparent day by day as you watch the news. And this software capability differentiate Pennant from its competitors. Nobody else has this integrated solution on the market, and we're the first organization to bring this to the market. So what have we done? Auxilium continues to gain momentum. You would have seen the interim results stating the GBP 2.6 million ARR. But here in front of you today, we're currently at GBP 2.9 million of ARR running towards achieving our GBP 3 million target for the year on track. We completed the major integration of our suite, as I mentioned earlier, that was released in June. Since releasing that in June, we've seen traction with both Siemens and a major shipbuilder in the APAC region, and we're progressing a number of big OEM opportunities that want this full capability. The Siemens partnership has delivered and has grown momentum. And we've launched the integrate -- and we've launched other capability. And Darren will be very proud of this. We're on track to fund the software development from our operating cash flows. We said we'd do it, and we're on track to do that. So good progress from Auxilium. I'm going to hand over to Darren. I want to give you a bit more color and flavor around what the Auxilium story is and where we are.

Okay. Thanks, Phil. It's quite a busy slide. It's a new slide as well or a new presentation of a story here. So I see is through the content as it's intended to be received. This presentation will be made available on our website, so you'll have a chance to digest this in your own time. We're essentially plotting out the 10-year Auxilium software revenue and investment story here between 2019 and 2028. Therefore, this has 2 or 3 years here of forward-looking projections or trajectory in '27, '28. 2019 to '25 are historic reported numbers. The first thing I'll focus on here is at the foot of the chart in orange, the capitalized development expenditures that have been directed at the Auxilium suite of products, largely since 2020, at which time there was an acquisition of a company called ADG, which is where the R4i software came from. And with that was a GBP 2.7 million investment in the acquired capitalized development at that point of R4i product. Since then, you can trace an increasing level of investment in product development as we move through the gears of bringing the best-in-class IPS software products to market. culminating in the release that Phil mentioned earlier in Q2 as a fully integrated Auxilium suite. And we shouldn't overlook the importance of that stage of investment. Auxilium is built now as an off-the-shelf solution on a modern technology stack that operates with a single fully integrated back-end database, meaning that customers now have a single authoritative source of data within a modern user-friendly interface. This has been a huge development for us and it has taken time. We're now starting to see that investment bear fruit in our commercial performance. So above the x-axis in shades of blue are the revenue streams derived from Auxilium products and services. At the foot of the stack there in light blue is the recurring revenue from software product sales. That means subscriptions and maintenance contracts that have been sold off the back of a perpetual license. The growth trajectory is very clear. From a base of GBP 0.8 million in 2019 through to an estimated GBP 3.1 million of recurring revenue in 2026, there's a clear correlation with the decision to increase the investment in product development. Related to this and at the top of the revenue stack in turquoise are revenues from one-off sales of Auxilium products. What does mean that's perpetual license sales. And since introducing that subscription pricing offering in 2024 that I mentioned earlier, we've seen minimal sales under perpetual licenses, marking a clear customer preference to roll license and support purchases into one annual transaction. The more complicated story, I guess, lies in the dark blue block of revenues there. This represents revenue from our associated Auxilium services, contracts for training, consultancy, data conversion and expert use of our software products, the largest of which is represented by our relationship with the Canadian Department of Defense. Now up until 2023, we sold all Auxilium service activities to the Canadian D&D under a long-term framework agreement. In 2023, this contract was broken up by the Canadian government into individual tasks, which were put out to tender for competition. Throughout '23, '24 and '25, Pennant got busy winning back that work in smaller contractual packages. That transition had a negative impact on the '23 to '25 revenues you can see there in the dark blue block. But in H1 '26, we were really pleased to announce the award of many of these tasks under a new long-term agreement with potential revenues of CAD 35 million over 11 years, 6 years, actual 5 years options. This gives us enormous confidence in estimating that Auxilium service revenues will begin to grow back to 2020, '22 levels by 2028. So to wrap this up, we're anticipating a new combined high from repeating and recurring revenues in 2026 of GBP 6.3 million and expect this to be the engine room of profitability growth at Pennant over the course of our 3-year plan and in accordance with our stated objectives. And finally, as we contemplate our levels of software development investment through '27, '28 following the release of our integrated Auxilium product. Our product road map is much more modular, as Phil and I would explain it, consisting of features and enhancements designed to meet specific customer requirements. We, therefore, expect more optionality on what we spend when we spend it, which should be conducive to further growth in Auxilium ROI in the coming years. So I took a bit of time on that slide, but it's an introduction of, I think, some new numbers and a new element to the story. So thanks for your patience.

Thanks, Darren. So just to build on that, I think Darren has covered a lot of this already in that summary, Vox. But the takeaway here is the technical services part of the group is gaining momentum. We're very pleased to have secured the multiyear contract Canadian D&D. For me, that's twofold. One, it validates a tool set; and two, it's a long-term sustainable revenue now in terms of services. We've also launched the new technical publication conversion service and won contracts on the back of that alongside our partner, OnePoint, great news. And we expect to issue a release our new viewing distribution capability in the final quarter of the year. And importantly, we expect a stronger second half performance as the revenues from the D&D contract come on board and we start to deliver the conversion capability. So a good story in Technical Services gain momentum through the year and pushing into 2027. The final segment I'd like to cover is Training Systems, often in Pennant to kill us here over the years, but I just want to take a couple of minutes to talk about where we are. It says on the title there, Training Systems in Delivery mode. I think the most pleasing part for me at the moment is the Training Systems business is operating and delivering. It's delivering its order book, it's hitting its milestones and its contribution to the group. It's got a current order book of GBP 9.6 million deliverable over the next 3 years, which means that the business having been restructured at the end of '24, in '25 is now making a positive contribution of the group and adding value. I think one point to pull out, and I think we may have mentioned this in the last IMC was around the new contract that we received for the training simulator in the U.K. Whilst the initial contracts were GBP 1 million, I think the opportunity here shouldn't be lost that there is a chance to turn it into production orders. The customer expects to make further deliveries across the next 5 years, and we're expecting to actually create a reoccurring product capability for that end user and its customers to deliver training capability for the foreseeable future, which is a very different model than training business. But the takeaway here is that train is delivering. Now I'm going to hand over to Darren, who's going to take you through the financial performance of the first half in a bit more detail.

Okay. Thanks, Phil. I guess the first thing to say is that we're pleased with these first half results. And more than anything, we'd like to thank all of our team members for their important contribution. Going into the -- from a highlights perspective, picking out a few highlights. Revenue has increased 30% over H1 '25 to GBP 5.8 million, and we'll go into a little bit more detail segmentally on the next slide. Also important to note is the growth in gross margins. Gross margins have improved significantly and compare well against the full year 2025 margin of 50%. We anticipate this level of margin to carry through to the full year for 2026 as we continue to win work at prices that reflect value as well as continuing to focus on rightsizing our cost base. Of course, as well, as we increase or as the software segment increases its proportion of contribution to the group's revenue, then we see a natural organic growth in margin, and we expect that to continue in the coming months and over the 3-year plan. think maybe a story that we haven't pulled out until now is that overheads when adjusted for one-off items have actually reduced year-over-year, and that's a purposeful move towards a more sustainable proportion of sales and doing more with the same. The one-off costs of restructuring our cost base have been recognized as exceptional items in the period and totaled GBP 0.6 million when combined with smaller charges for acquired intangible amortization and IFRS 2 charges. As a result, we've posted an adjusted first half EBITDA of GBP 0.5 million, which compares to a loss of GBP 1.1 million for the first half of 2025. With respect to our 3-year plan to sustain an improving level of profitability of the business, it's important to note the progress in both our ARR from Auxilium software products and our efforts to maintain a strong order book. ARR at the half year was reported at GBP 2.6 million, and that's grown over 20% since the prior -- the equivalent prior period, with further growth in the 2 months post period end and a solid order intake in the first half means that our order book gives us excellent coverage for 2027, which Phil mentioned earlier, currently in excess of 80% of market expected revenue. And lastly, on the highlights slide, I'll pick out net debt. At GBP 1.0 million, that's increased from a reported GBP 0.5 million at 2025 year-end when including a shareholder loan. And that's in part due to payments of one-off restructuring costs of GBP 0.5 million. It's important to note that in the second half of the year, we're expecting milestone receipts on some of our key training systems projects, meaning that it's our expectation for H2 cash flow to be better than H1. It's also important to note that we continue to receive strong support from our bank, HSBC, and that Pennant remains appropriately funded. So we'll go into a little bit more detail now. We'll skip over the statutory income statement and go into the segmental analysis. So first of all, system support software, AKA Auxilium, 17% increase versus H1 '25, a total of GBP 1.4 million in the half. And that's been driven by an increase of 9% in the number of licensed users of Auxilium. That's a 9% increase over the last 12 months. And that's arisen from sales to 15 new customers across defense, maritime and space. And as mentioned earlier, the large portion of those sales were under subscription, the vast majority. I've already mentioned ARR and the growth year-over-year and the fact that we've hit a new all-time high of GBP 2.9 million at the time of announcement today. And those opportunities have been amplified by the successful release of the fully integrated Auxilium suite, meaning we're very confident of meeting our stated objective to exceed GBP 3 million as we exit 2026. Technical Services revenue were weaker than expected in H1 '26, and that was due to the delayed award of the IPS services contract that I mentioned earlier with the Canadian D&D, and that means we're confident of catching that up in the second half of the year. In fact, we expect the full year revenue from Technical Services to exceed prior year and well on the way to our stated objective of exceeding GBP 7 million of revenue in financial year 2028. And finally, to training. Total revenue for the Training Systems segment more than tripled year-over-year to GBP 1.9 million. And that's due to the strong order intake that we saw at the back of last year with the order from the MOD for the GenFlight project and the order from BAE Systems Australia for the ARI project. And those are the 2 programs that are contributing the most to that revenue increase. And as Phil has mentioned, are delivering to plan or on plan. And then lastly, on this slide, I would say that the -- Phil has already mentioned that the deliverable order book for the Training Systems segment stands at GBP 9.6 million against our stated objective of keeping that number above GBP 5 million at all times and removing the feast and famine in that segment that we've seen in the past. Okay. Thanks, Phil. And then quickly touch on the next couple of slides. So this is the statement of financial position and the balance sheet. Two things to note here. Again, there's more details in the full interim announcements on our website. Prior year current assets included GBP 1.1 million of assets held for sale as we completed the U.K. property disposal program last year. And something I'd like to pull out around our net current liabilities, they do include at the 30th of June, GBP 1.9 million in the Training Systems segment of contract liabilities. There was 0 balance on that account at the equivalent point 30 June '25. That is cash received into the business ahead of us -- ahead of the revenue being recognized or the service being delivered. I think it's important to pull that out and note that in our net current liabilities balance. Thanks, Phil. Already touched on kind of the net debt figure, but just going into a little bit more detail around our first half cash flow. We delivered a net cash inflow from operating activities for the first half of the year. Phil and I are pleased about that. And that was after incurring GBP 0.5 million of one-off restructuring payments. So gross of that, it would have been a GBP 1.1 million operating cash inflow. That's important because of our objective in this 3-year plan to begin to cover the cost of Auxilium development, which is in the investing activities line through our operating activities to fund that development organically in the business. We're very close to doing that, and we should achieve that for full year. In financing activities of minus GBP 0.5 million, we repaid the aforementioned shareholder loan as well as meeting our ongoing lease liabilities. And then lastly, on this subject, as the final bullet point alludes to there, in Q3, HSBC have given us some good support to temporarily increase our overdraft limit post period end to see us through some working capital timings on our key contracts. And in Q4, we're expecting those milestone payments from ongoing to target deliveries on our trading system contracts to bring us back within headroom. Okay. Thanks, Philip.

So outlook, just to wrap up today before we go to Q&A. I think my takeaway from this is the plan is working. EBITDA has moved from a loss to a profit. Recurring revenue is increasing. Darren has touched on the ARR growth to GBP 2.9 million of continued momentum. Order book gives us high visibility for '26 complete revenue and '27. Margins are improving. And as a management team and the Board, we remain very confident of meeting '26 expectations. So with that, we're finishing on that positive note, Tom, let's hand back to you for Q&A.

Thank you, Phil. Thank you, Darren. Now if we could turn to the questions, we have a number of questions submitted ahead of the presentation, [Operator Instructions]. You'll be surprised to hear that we've had quite a few around Siemens agreement. So maybe we can just start with Siemens. I'm going to group 2 questions together, which are largely the same. I'm relatively new to the story and I'm delighted on news of the 2 contract wins for our Siemens OEM deal. Are you able to provide any further details on the scale of the opportunity? And Matt asks, how significant can the Siemens partnership become over the next 3 years? Are we talking about a handful of opportunistic sales? Or do you see Siemens becoming a material distribution channel?

Okay. I'll go first on great questions and then Darren chip in. So if I covered some of this during the presentation, but I think it's important to recognize why Siemens originally sought out a solution. Siemens had a gap in their team center offering that they needed to address their competitors in the PLM market have capability, and they were under critic for a number of big primes for this weakness. They've picked Auxilium, our product suite to address that gap because they felt there was a need to do that. Siemens strategy is to sell Auxilium into the U.S. defense market, a market that's relatively small for us but a huge market. But beyond that, they want to take it globally and into other sectors, but the priority is U.S. defense. It's early stage in the relationship. But the point I would make in terms of the ARR objectives that we stated as a Board, Siemens is not included in that GBP 4 million target in 2028. So we're talking about ARR growth to GBP 4 million by the end of 2028 organically through our direct sales, the partner channels, particularly Siemens is not part of that strategy. We're quite excited by Siemens, as you can imagine, a big organization, but it's been hard work to get to this stage. We're looking forward to the next period. They've got a number of marketing campaigns, webinars, lots coming out and working closely with them. Darren can talk about the strategy we've got in terms of product and strategy with them as well. But it feels like momentum is starting to grow. And during this process of securing Siemens, they provided indications of what they thought they could contribute in terms of revenue and opportunities. We haven't seen that yet. We've seen a couple of sales. We've seen momentum. But it just goes to that I'm cautiously optimistic. It's early days, and we really need to see how it progress over the next 6 months.

It's taken us a long time to get to this point longer than we thought. The onboarding process was quite involved. And since formally kind of launching on their price list in June, May, June this year, Phil is right, we've seen 2 sales into U.S. defense end users, which is extremely encouraging because that's the gap in the market for us. But we're seeing momentum now. S. O on a biweekly basis, we've got 2 conversations going on with Siemens, one through their product group, the product specialists around product support, IPS space. That's a good route in to specific opportunities. We've also developed a good relationship with the aerospace and defense strategy team. So we're having biweekly meetings there to give us access to global account managers and start to demonstrate and promote Auxilium software into Siemens globally. So some really good routes to market being developed in collaboration with Siemens, and we're very optimistic about further opportunities in the coming months.

The bit I would add is there's 2 bits to Siemens. I think everyone is focused on the opportunity, and I don't disagree, there's a big opportunity there, but there's also the intangible, if you want, the credibility of the software. As a relatively small SME competing in a global defense market, it shouldn't be lost by the fact that Siemens Team Center picked Auxilium as the to support its software when we're in competition with 2 very large international U.S. primes. That's a big endorsement to the technical competence and capability of our product set and the fact now they've sold it into U.S. defense and now actively pursue it tells you that they rate the product -- so I think for me, that endorsement of the investment we've made in the product is equally important to the opportunity. The opportunity will come, but that gives us real credibility when we're having conversations with large defense primes that Siemens are actively marketing this solution.

I'll probably just close that whole answer up by saying that I think we're in the process of ascertaining what that pipeline will be. So with some early wins and some early visibility, I think we're starting to jointly develop that pipeline visibility, and we'll have it in short course.

Which we'll come back to. But an extension to the question there is, are the 2 recent wins indicative of the value we might expect from any further successes, i.e., 150,000 to 200,000 ARR per deal?

I think it's hard to say at this stage in terms of the size and scale of opportunity. At the moment, the sales that have been made have been into a project team and into a particular site. They haven't been an enterprise solution or a whole company solution. They've always been trials. I think we believe the opportunities are bigger than that. But at this stage, we've got nothing else to go on. So at the moment, 100,000 would be a sensible ballpark, but we'll have to validate that as we move forward.

You a little bit, but maybe we can just see if there's anything else you have. How can Pennant support Siemens to improve their sales efforts? And what visibility do you have of the pipeline?