Pureprofile Ltd (PPL) Earnings Call Transcript & Summary

Well, hello, everyone, and welcome to Pureprofile's FY '24 Half Yearly Results Investor Briefing. My name is Jane Lowe. I'm the Managing Director of IR Department, and I'll be your moderator for today's session. Joining me today is Martin Filz, who's the CEO and MD of Pureprofile. Good morning, Martin.

Good morning, Jane.

Good morning and also Melinda Sheppard, who is CFO for Pureprofile. Morning, Mel.

Good morning, Jane.

Good morning. Okay. So our format for today is Martin and Mel will walk you through the results that were released this morning to the ASX platform. They're also available via the Pureprofile website. The presentation component should take around 15 to 20 minutes. After that, we'll follow on with a 10- to 15-minute Q&A session, and you're all invited to participate in that. [Operator Instructions] So for now, though, I'd like to pass over to Martin and Mel to get us on the road. So thank you, Martin. Thank you, Mel.

Thank you very much, Jane, and thank you very much, everybody, for joining and to all our shareholders who support the business. Good morning. So moving on.

I'm going to kick off with our first slide, which is really probably the highlight of today's webinar is announcing that we've actually made our first profit of $41,000 for the first half of this financial year. And that was up from a net loss in the same period last year of $386,000. So that's something that we're incredibly proud of. Many of you that have joined the journey with Martin and I over the last couple of years since we've done the recapitalization and debt restructure are very much aware of the fact that this has been a real key milestone for us and something that we've been moving towards over the last couple of years. We've continued with our disciplined investment approach to ensure that we continue to grow from a top line perspective, but also improving our profitability and our margins in our business so that we can move towards being net profitable. So that's a fantastic result for us. So that was actually 111% up. And I just want to point out too that most of the slides in this deck relate to the continuing business only. You will be aware that we did close our Pure.amplify business during FY '23. And so the -- when I get to those particular slides where it does include the discontinued business units, I'll call that out, but it's mostly all the continuing business units. The other highlight is our reported cash balance of $4.5 million at 31st of December. We had a significant uplift in net cash from operating activities of $1.2 million. You'll see that when I get to the slide, we'll talk a little bit about that as well. Obviously, the debt remained unchanged and that was refinanced during the first half of the year as well, and we've talked about that. Most of the other sections on here, we've already been through when we did the last update, but strong revenue growth for the half of 8%. Our continuing business EBITDA was up 6%. We have made a change to our remuneration structure and predominantly around our STI, which has moved from being equity to cash-based, which means that the expense of that STI is now considered an operating expense. If we did a like-for-like comparison, our EBITDA would be 21% up on the prior comparable period. One of the callouts from a revenue perspective is that our platform revenue growth was 104% up on the prior comparable period and that was driven by an increase in our panelists recruited from audience builder partnerships. And then just another note of just the clients that we had during that 6 months of the year of 795, up from 784. So that's really the key highlights. I'll get into a bit more detail when I get on to the rest of the financial highlights. And I'll hand back to Martin.

That's great. Thank you very much indeed, Mel. So talking a little bit about some of the detail behind that. And this is similar to as we talked about at our AGM as well. So the growth that we saw that revenue growth in the half 1 predominantly comes from investing in new commercial people. So those new commercial team members that we've invested around the world driving that revenue growth. We opened an Indonesian office at the beginning of the year. So very excited about that, and we're actually in 13 different countries now. And one of our new U.S. clients, there's been a client for slightly over a year is now into top 5. So excited about that. It's a great reference client, and it shows the opportunity that I've talked about of being in the U.S. that we really need to get into now. The platform, Mel talked about that. We've had a couple of new audience builder partners that came live, especially into this year. So ShopBack in Australia. We've now actually also gone live for ShopBack in Germany, Prograd in the U.K. So some of the driving of that growth, especially ShopBack in Australia driven that 104% on platform. We've expanded and consolidated other Audience Builder partners. And then I'll talk about this a little bit later, but I'll mention it now. We've also seen a growth in clients buying directly from our platform as well. And not as significant as we see on the Audience Builder side, but that's something that we look forward to in the future growing is more clients having direct access to our systems and so giving us growth on our EBITDA efficiency and expansion of our margins. Technology enhancements. So Audience Builder improvements, making it easy for partners to work with us, more efficient setup, delivery of data, et cetera, to them. We're opening up those core panels to enable direct access, the ones I just touched on for clients, which is increasing revenues and efficiencies. The clients that wouldn't necessarily work with us on a managed service basis, but want an automated platform type basis. And also that we've now about a year ago, we established coming up to a year ago, AI group within Pureprofile to just purely look at AI and the efficiencies and the growth that we can see from within AI. And there's a lot of noise around AI today. And it's really been very useful having that group that then liaises with our product team and our tech team and actually identifying what's real? What's real that you can implement that is going to change either the way that we deliver to clients at the moment, the way that we work or actually bringing in new solutions. So as the year -- 6 months has been going on, we've been rolling out internal AI solutions. And I've talked about such things as AI translations, AI coding for us as a business that makes it easier for us to work with clients, faster delivery for clients more efficient at our back end. So those we continue to roll out and evaluate as we do in any business. The big change on AI is we had a lot of noise last year generally in the market, everybody was talking about AI. And today, it's changed to clients saying, okay, how is this really going to benefit me? What are you doing that actually is going to make it faster, higher quality or cheaper to me versus then just hype on AI. So that's the biggest shift we've seen in the market. I've had this slide up for a few years. Numbers change slightly. But the key thing here is going into that rest of the world, U.K. and U.S. make up 63% of our market share globally, the insights space -- so that $130 billion market, 63% sits in those 2 markets. And that's where we've been putting our investment. And that's why you've been seeing our international growth is more than double our Australian growth, and that's been true for at least 2.5 years. And that's where our investment is going. And with that, we talked about that in a little bit at the half 2 release, but we opened up a German and a Spain and Portugal office by hiring 2 senior people to start expanding those regions for you and followed the same method that we followed in other markets that we hired somebody senior. They're supported by their local hub. And then as clients and revenue grows, we grow out that internal team, same as we've done in the Netherlands and in Singapore and Indonesia, where Singapore and Indonesia, we have over 10 people now. So we grow out that based on client revenues as they come in. So we continue to expand and especially to expand in those international markets. On the right-hand side, this was up here again from the AGM. And it's just to remind everybody the opportunities for Pureprofile within the AI space. So firstly, we're a quantitative market research company. So that's larger sample sizes, faster turnaround versus qualitative, which is more face-to-face interview, smaller sample sizes whilst higher value per interview. AI enables quantitative companies to actually start to dabble in and start to be involved in qualitative research. So that's an opportunity for us. Synthetic data. AI enables small amounts of data, which is called training data. So we generate high-quality data from our audiences. And then from that high-quality data, AI can actually extrapolate out what that infers to a larger population. That's called synthetic data, and that also is starting to make inroads in the market research space and Pureprofile is in a fantastic position to have high-quality training data that can then form synthetic data. New clients. All of these AI companies need data and they need high-quality data. So actually, we're better to come to Pureprofile. We can be used as training data, as I just mentioned, validation data, they're just about to maybe make claims or announcements, actually validate that quickly by looking at a real known audience. And then finally, it's understanding the why. So AI systems and AI data will tell you a lot about the what. It's what people are doing, when people are doing it, but it doesn't say why they're doing that. Why is somebody buying an electric car? Why is somebody looking at that advert and not another advert? Why is somebody voting in a certain way? AI only tells you what they are doing. So those clients become new clients for Pureprofile. New solutions. So again, it opens up and we're looking at that at the moment, client-facing solutions that can access our data using AI and natural language as opposed to SaaS systems, so natural language SaaS systems as opposed to coded systems. Real-time insights. So again, large data sets can be interpreted in real time, so AI enables that. Automation, touched on that slightly, clients coming directly to accessing our data and again, freeing us up to do more consultative work. Efficient data analysis, so faster data analysis for our teams, cost savings, AI translations by running that instead of through translations agencies, saved us money, saved us time, delivering faster to clients, higher quality. And then innovation. What's interesting that AI has also done is it's made companies think much more about innovation. It's made companies think, well, hang on a second, I can do this quickly with AI. AI tools, generative AI might not be right for this problem or the opportunity I'm trying to solve, but it makes companies become more innovative. And so that's very positive for us. So it moves us faster down the innovation line, bringing out new internal tools and new client-facing solutions as well, so faster development. Touched on that, it's talking about the 63% in the U.K. and U.S. For those of you who don't know Pureprofile well, just a little past history. We're actually a 23-year-old company. I came on Board in 2020. We did a company restructure. We did a capital raise to remove debt, a large amount of debt that the company had and brought in new executive team and then focused the company on being a data and insights company. The last 3 years has been looking at what do we do really well in Australia that we're #1 and actually, how do we replicate that in the other markets. And so that's where I talked about earlier, we're seeing double-digit -- double growth versus Australia in the international markets because that's been a focus absolutely of the company. So global team expansion, global processes within that, because a 23-year-old company, the company for a few years before I joined hadn't had investment. We're actually using that positive cash flow that we're making and actually reengineering our core technology over the last 3 years. We talk about changing the wheel while the car is still moving. So we've been growing fantastically whilst also in the background, improving, changing, developing our technology. Recognizing Audience Builder as a USP for us as a company, growing those audiences quickly, especially in Australia. Throughout the time, 3.5 years, we've seen efficiency, margin expansion, improved profitability from clients and doing the right type of work with the right sort of clients and that scale that we've seen as a business, almost doubling in revenue over 3 years has driven that scale and that efficiency as well. And then we have an amazing team. And really, that's been an absolute focus of being people first. And the reason about being people first is that clients want to buy from organizations where the people are proactive, are passionate, are consultative, problem solving, et cetera. And by Mel and I, especially having focus on the people, we ensure that we have that across the teams. And then again, from the recapitalization, aiming to enhance that shareholder value. The markets aren't great for microcaps at the moment. We feel that we've heard from shareholders and feel that being truly NPAT profitable, not just cash flow positive is something that's important to the market and will stand Pureprofile out in the shareholder market as well. So that's been a focus for us as an organization. And then when we look forward, so this year and forward, it's about now accelerating that global growth. So increasing revenues margins by those end-to-end solutions for clients, hiring -- continue to hire great people, building out an integrated suite of products to work with, investing in global growth, having great technology partnerships that give us faster delivery and route to market. We don't have to build everything ourselves, touching on that AI again, seeing how that can accelerate client delivery or efficiencies within our own business, growing our audience builder partners and innovative technology. And then also acquisitions, it's -- I've talked about it recently on an interview we did. Our market cap has come down whilst revenues, EBITDA and NPAT has gone up. And that hasn't necessarily happened in the private market. So whilst we're still interested in doing acquisitions to see where that can give us a step change in a new market, we have to be conscious of where we are as a business and make sure those aren't dilutive to shareholders. It's not risky. Perhaps it's out of cash that we're generating at the moment. And -- but while still looking at those. We are still looking at those being cautious, don't want anything to be dilutive. So that's sort of as we look forward this year and the next 2 years. Again, for those of you new to the business, in 2020, this is what Pureprofile looked like. It was very much a managed service business. We've got clients on the left-hand side in our business on the right-hand side. So it was very much about having audiences, having panels, some audience builder panels, some panel partner network, about 10 million people, and it was all managed service. So through our team's direct services to clients direct services and then really, they could use 2 products. So we had Insights Builder, our DIY to lightly used and then the majority was managed service. As we've move forward where we are today, we've got access to 21 million people around the world. So to do much more client work in a wider geographies -- in wider geographies. We've still got Pureprofile panels, Audience Builder panels, The Partner panels, but now we've got what we call -- what our APIs. So this is direct connectivity between client sources, partner sources, client delivery and so we're starting to see that automation. So on the client side, again, they can now access us directly through APIs. And we launched a new product about 2 years ago now called Audience Intelligence that merges together transaction data with our survey data and again through a SaaS platform. And then when we look forward to sort of 2025, where will we be? Well, it's the same on the right-hand side, that we're now 50 million people around the world. Synthetic data is now added in, so being able to do that faster sort of market sizing quick feel of data. Then on the left-hand side, we've got clients being able to use AI. We've got us being able to do qualitative research, AI activated insights and then client solutions, which we don't offer too many of at the moment and thinking about direct clients. So they don't just come to us for perhaps some data or surveys. They actually come to us because we have products that they can purchase. It's almost shrink wrap, could be ad effectiveness, brand tracking. So that's the journey that we're now on is adding these yellow parts to our business. And with that, you heard enough from me. I'm going to hand back to Mel.

Thanks, Martin. So as I said at the very start, our inaugural net profit for the first half of this year of $41,000, up 111% on the prior year. You'll be familiar with the revenue number of 8%. When you're looking at the financial statements and particularly the 4D section, the revenue that's -- the headline in there actually includes the discontinued business, which is why you'll see the revenue decline year-on-year from the headline, I suppose, the statutory revenue number. As we said in January, our EBITDA was up 6%. And then our ANZ business revenue was flat year-on-year and predominantly, our revenue growth came from regions outside of Australia. So we talked a little bit about that when we did our January update that we saw strong growth in different regions through outside of Australia. 22% and obviously, the platform number of 104%. So really, really strong growth in that part of the business over the last 6 months. If you like to go to the next slide, please, Martin. So this is one just sort of giving you a bit of a snapshot of where we've been. In fact, actually, the first year that I started back in 2018 or FY '18, the company made a $25 million loss. So I think we definitely have been on a journey over the last 5 or 6 years. And Martin and I have been heavily focused on making sure that we're operating cash flow positive and really moving towards profitability. And so as you can see for this financial year, a very small profit. You can see that the EBITDA growth -- basically, what this chart is showing is how we've grown EBITDA and that the loss has come down and has now shifted to profitability. Point to note is the actual statutory NPAT was $4,000. We still had some expenses relating to the Pure.amplify business in the first quarter of the year. It actually didn't shut down until July. So there was a little bit of expense that wasn't provided for in the prior financial year. And that was a loss of $37,000. That's how we end up with the $41,000 profit if you exclude the impact of that Pure.amplify business. If you can go to the next slide, please. So again, you'll be familiar with these numbers. We talked about it in January. So 8% revenue growth for the half, predominantly all the growth coming from the rest of the world, where we had really strong growth in India of 92%, Southeast Asia, 56%; and the EU, 11%. We just called those ones out because that is since -- whilst the numbers aren't material, the growth there for those regions is really pleasing to see. And we've really been investing in those regions. So it's fantastic to see that return. ANZ was flat on the prior comparable period. We did have Q2 revenue impacted by a softer trading environment in October. October was a soft month for us. The revenue came -- bounced back in November and then bounced back again in December. So that was pleasing to see and that sort of brought the whole quarter down from that perspective. Again, we've been continuing to grow our network with platform and predominantly through the Audience Builder solution that we have. So that's what assisted this 104% revenue growth in the platform, talked about the client numbers continuing to increase. And then our project volumes continue to grow, obviously, resulting in the revenue growth. And in fact, actually, we had a record number of projects being in play in the month of December, which is really pleasing to see as well. If you go to the next slide. So this is just a snapshot of the last 4 years of our EBITDA results. So this is EBITDA for our continuing business as are all the slides. So the revenue growth of 6% and an EBITDA margin of 10%. This obviously all includes the impact of the cash-based STI in this financial year. We talked about the fact that EBITDA growth would have been 21% if you had a like-for-like basis. So where is that growth coming from? Well, it's coming from the revenue growth, improving gross margins, and that's related to a lot of the work that we've done over the last couple of years on procurement, making sure that we're procure -- like when we're buying third-party sample or we're doing any partnerships, we're trying to maximize our margins. As we've got larger, we've got more scale, it allows us to get better pricing when we're using suppliers. And the final point is also we've been really careful about our investment in the business, making sure that we're not investing too far ahead of revenue. So when we make an investment, we'll put a small amount of money into a region and then make sure that we get those returns over time before we invest further. So continuing to see those margin expansion. Some of the things that we're doing around AI will help us continue to build that margin expansion as well. And then obviously, the platform, so having significant revenue coming from the platform business, that's obviously positively impacting our margins and reducing that reliance on the lower third-party panelists that we have to procure occasionally for some projects. Go to the next slide. This one you're all very familiar with, just showing the financial trends, very consistent with what you've seen over the last couple of years. I've popped in the 3-year compound annual growth rates, each of those different charts that you've seen there. I won't spend too much time on this. You would see this in the January update. Next slide, please. So then just a full year statutory profit reconciliation. I suppose the only thing really to call out here is share-based payment expense is obviously a little bit lower for the first half of this year compared to last year. For those of you that are across some of the remuneration changes that were implemented in the first half of this year, our STI program for KMP and executives has moved to be cash-based from equity-based, and there is no long-term incentive program in this financial year. That said, there is still share-based payments going through the P&L. Share-based payments are expensed from when they're granted right through to vesting. A number of the plans are still in progress. So you will continue to see share-based payment expense in our P&L. It just won't be at the same quantum that you may have seen in prior years and it will be lower in the second half of the year as well. So that's kind of really the main thing to call out from the statutory reconciliation. We do use the terminology EBITDA, excluding significant items. Predominantly, the significant items has been share-based payment expense. There's no other expenses that we've been calling out as a significant item. In prior years, there have been significant items that related to the capital raise or the debt restructure. Last year, the only other significant item was the shutdown cost for the Pure.amplify business that was sitting in the P&L, but that was mostly -- was pretty much taken up in the last financial year. So that's the statutory profit reconciliation. If you could just go to the next slide. Balance sheet. As you can see from here, we've talked about the closing cash balance. It's down slightly on the June.Typically, the first half of our year is seasonally slower from a cash perspective than the second half. We make most of our cash flow in the second half of the year. And that's just related to the timing of expenses plus the timing of rebates that we will pay out in the first half of the year as well. Other thing to call out is that, obviously, the loan being refinanced in -- at the very end of November last year has meant that the loan has moved back to being a noncurrent liability with the exception of any of the principal payments that we'll make during the year. And everything else is pretty much broadly in line with where it's been previously. Obviously, as the business continues to grow, you'll see the trade and other receivables increasing as are the trade and other payables. So -- and we're also obviously providing for that cash-based STI throughout the year as well. So that's been expensed over the -- from the time that it was put in place. If you go to the next slide, please, Martin. So this cash flow slide, so this does include the discontinued business units, and this aligns with what's in the statutory of the interim financial statements. So this -- the reason that you'll see the receipts from customers down and the payments down is because the prior year included the Pure.amplify business units. So it's not that we're collecting less cash from our customers or our clients. It's just that it's not an apples-to-apples comparison. So that's probably the key thing to call out. We did have a termination fee that we had to pay for the facility that we had with [indiscernible] Capital, that was around $190,000. So that's why if you look at the interest and other financing line of $300,000 versus $100,000, that difference is just the termination fee on the facility. The new facility only had setup fees of around $15,000. So that wasn't very material. And you can see everything else is kind of broadly in line or slightly down on the prior year. And if we go to the next slide. So just reiterating, when we did our AGM, we put out some financial guidance. So we've put out a revenue guidance of $46 million to $51 million. We are reiterating this guidance. Our EBITDA margin, excluding significant items, is 7% to 9%. So just reminding you that, that does include the impact of the cash based STI, which we are estimating will probably be about $1 million. And then if we excluded that and looked at it from a like-for-like perspective, the margin guidance would be broadly 9% to 11%. So I think that's it from me, and I'm going to hand back over to Martin.

Thank you very much indeed, Mel. Again, just touched on most of these points. AI, looking at internal and client-facing solutions, and Tech innovation. We've gone from that period of last 3 years of updating our internal systems to actually looking now at real innovation internally and externally. Platform, increasing the use of the platform where we saw that 104% for the first 6 months. So larger audiences through Audience Builder and also higher adoption of our direct panel platform by clients. Team growth, adding new clients comes from adding new team members. I was in the office yesterday, so somebody later new started in the sales team. We've got new people starting in Germany, Spain, Portugal, as I mentioned. So continuingly adding the commercial people to add new clients to the business, focus on U.K. and U.S., where 64% of the global market sits today, and we can see winning a big U.S. client, the difference that makes immediately in a short period of time, go into top 5. And then commercial partnerships. So we've got close to 800 clients around the world. We're in interesting locations. So we're continually talking to companies as well as seeing if they -- we can represent their platforms, their products, their solutions and actually cross-sell those to our existing clients, giving us additional revenue streams and also making us more sticky for existing clients. So those are the things we're focusing on this remainder of the year. So in summary, delivered a positive $41,000 net profit after tax for half 1 '24 for the continued business. So very excited about that big milestone for us as a business, something we've been focusing on. It's another record half year revenue and EBITDA for the business. We continue on delivering record halves for the business in both revenue and EBITDA. So very excited about that. International business growth continues well over 20%, as you've just seen, large number of highly loyal and satisfied clients around the world. And then the focus is we continue to target those global and data and insights and Audience Builder opportunities. So I'm really pleased with another great set of results. And as Mel talked about, especially with that first NPAT for the business. So thank you, everybody. And with that, I hand you back to Jane.

Thank you, Martin. Thanks, Mel. Some really outstanding results reported today. So congratulations. And actually, the first question we have in the mix relates to that. Another congratulation to add here. So you've reported a small profit for the half. Congratulations on achieving this milestone. What can we expect moving forward?

So obviously, we've talked a lot about profitability being a really key milestone for us. So obviously, moving forward that, that is going to be one of our key focus areas for the business. Where we land after the second half of the year will obviously depend on investments that we make during the second half of the year. We will continue with that disciplined approach around investment, making sure that we're not investing too far ahead of revenue and making sure that we can continue to deliver that bottom line growth. And we want to continue to see the bottom line growing. We want to see that profitability getting larger over time. And we just want to continue to make sure that we get the balance right. So I suppose the key headline with that is just continue to see more of what we've already been doing for the business.

Excellent. Good message. And in my enthusiasm about offering my congratulations, I realize I forgot my housekeeping, which is reminder. [Operator Instructions] We do have a few in the queue. So revenue for the continued business was up 8% for the half, but revenue generally was highlighted as being down 3.1%. Can you help us with how we should be thinking about revenue moving forward, perhaps for Mel?

Yes. So just as I mentioned that most of the slides in the deck relate to the continuing business highly. When you look at the 4D and the financial statements and predominantly the revenue being 3% down, and that's predominantly because in the first half of FY '23 that we wrote $2.5 million worth of revenue in the Pure.amplify Media businesses that obviously were shut down during the last financial year. So that's really the result of the reason why when you look at it from a statutory perspective, the revenue was down, but the continuing business was up 8% -- what would you continue to see during the second half of the year? Well, pretty much the same as what we're seeing now. We're continuing to invest globally. Martin talked about some of the new roles that we've hired, particularly in Europe. We've also hired a new role within our Australia business from a revenue perspective. So you should continue to see that revenue growth aligned with how we've been trading over this -- over the financial year already pretty much.

Thanks, Mel. We've got a related question. So great result. I'm just curious if you can give a bit more color around what happened in October?

I don't know if you want to answer that one, Martin or myself.

Yes. I mean, just looking in the Q&A, I think the two are related, [Stella] and Ben's questions to Stella regarding Australia Data and Insights segment. Has the market activity shown further improvement this January, February after coming out of the October bottom. So very good point. Certainly, Australian market was soft in October. The clients that we work for, if they could be government or it could be some doing ad effectiveness or brand work or product work. They just have restricted budgets over quarter 2, and we in October, as Mel said, came back again then in November and December was a normal growth month for us. But certainly, the market is quieter. And if you align that with -- what we also saw in the retail expenditure over Christmas, I think it's the biggest ever drop that we've seen in the country over Christmas period of expenditure. So the higher interest rates, higher inflation are clearly starting to bite in the Markets Day. And as a B2B company, we just started to see that happen in October. And particularly in October, we just -- it was a very, very quiet month across the board, especially in Australia. As I said, came back in November, it came back in December, but the drop meant that it was flat for ANZ for the half. January anyway, and Mel touched on this, Stella, it's a quiet period for us anyway in Australia, so being a seasonal business. So we then expect that after January being quieter and then February and March onwards to be busier the rest of the half for us as a company. But certainly, that drop we saw up to date, specifically in October. And it's also one of the reasons why it's important for us to grow into the international markets. You never want to be reliant on one client in a market or one market in a company. And for us, I think going back to 3, 3.5 years ago, the business was 80% Australia. And so as a company, where we're #1 and you're very exposed to any change in the market. Today, it's down to about 52% with 48% being the rest of the world. And so that has been beneficial to us as a business that you still saw 22% growth in the rest of the world, whilst the Australian economy is quite. So as a company, whilst it's complex being in 13 countries and all the languages and nuances of the market, actually, we have multiple levers to pull. And as we add new products, we have more levers to pull and as we have more countries, we have more levers to pull. So that starts to smooth the sound should we see any downturn that we saw in the Australian market today or in the future if we saw that in the Singapore market, et cetera. But all signs are that country has got to lead on inflation now. Interest rates should be dropping. And so we should see the Australian market come back generally overall, and that will then also benefit Pureprofile.

Excellent. We would like to see that. Okay. So another question. Thank you, Stella. It's great to see intangibles CapEx was kept relatively flat as previously guided. Could we expect this to continue with so many tech and product expansions planned?

Great question. And absolutely, we've signaled previously that we're not expecting that we're going to make any substantial increased investment in what we call product and development within our business. Martin talked a little bit at the start about some of the changes and the enhancements we made to our technology platform and stack. And -- those investments that we made over the last couple of years has really allowed the mix of the tech team to sort of shift to more sort of innovation away from sort of that improvement or the -- like reducing the technical debt that may have been in the organization previously. So that means that then the team can spend more time on AI enhancements, et cetera. And so we're really starting to see that shift now predominantly over the last 12 months where the team do have more bandwidth to work on innovation and new product development. And so we will continue to spend about the same. The uplift in the CapEx cost really for us is only the small amount of pay increases that the team members get. But we're not looking at any substantial increase in headcount from that perspective. We believe that we can continue to do and innovate within the business, within the existing like investment wallet we have now with that team.

Thanks, Mel. I'm conscious we're getting pretty close to time. So we might just take a couple of final questions and then let people continue on. So you mentioned AI just then when -- where do we expect to see the initial benefits from AI? Can you quantify them? And what sort of time frame we might be looking at perhaps for Martin.

Yes. quantify them, it's a range of solutions. So it might be a new revenue solution or it might be a slight cost saving one. And so each individual project will have different ROI return on investment on that. And for example, the AI translation tool was about $150,000 to our bottom line from not needing to do that with agencies. So there's a real tangible benefit. It's then continual. So there's no specific time frame. It would just be doing business better. So as part of us as an organization, not everything will be client-facing revenue generating, and they would just be rolled out that will see improvements for us as a business. But it's more back to Mel's point, it's about us being able to innovate now and us being able to do things better every day versus we have this technical debt that we need to get rid of. And for everybody with a strategy session a couple of months ago now and our CTO in that said, please, he said, please can everybody stop talking about AI because we have problems to solve and opportunities to take advantage of and AI might be a solution within that versus it's a be all and end all to everything that we do as a company. So it's continued margin expansion and continually doing work faster and better for clients.

Thank you. Okay. So related to that, can you talk about opportunities and threats for Pureprofile in a cookie-free world?

We're at time. Thank you. I saw that, Chris. Look, I think you've got the 2 big buckets at a very high level. The threats, other data sources coming in. So will people get their data from other sources versus coming to Pureprofile. That can be a threat. For those who know, just talking to a U.S. partner this morning on a call, Google went live with their AI search engine last week that was going to replace everything else that they did. They had an image search engine on that. And people were able to go into that and say, for example, show me images of the founding fathers. And rather than seeing the founding fathers, it brought up different nationalities of people, it brought up different genders of people, et cetera. And so the code didn't actually work. And this is what we're seeing with AI data today. It's unknown going in and therefore, unknown results coming out. And it's being set back by things like the Google launch, which is great for us that has high-quality data. So whereas you see a threat coming from this synthetic data world, cookieless world is another way of putting it the synthetic data, actually, the opportunity is high-quality data from people like Pureprofile is always going to be needed. And that then to that second group of clients, what's the big opportunity? Well, the big opportunity is Pureprofile leading with AI training data on a strong set of data. So that's the first point. And then all of these clients needing Pureprofile data to actually verify, et cetera, what they have as a business. So I see it more as opportunities than threat, but we need to be very cognizant of other data sources where they're being able to be used to replicate what Pureprofile can do. And so it's important that point also that adding towards that efficiency, the big point of AI data is it's a lower cost form of data. Well, if Pureprofile is less managed service and more automated, aren't we then acting like an AI company. So growing those margins out for us as a business being more efficient is actually overcoming the biggest threat from AI, which is a cheap source of data.

Makes a lot of sense. Okay. So I know I said 2 questions. I'll just throw this final one in and then Thomas will wrap it up. So on guidance, Mel, so you reiterated guidance to be between 7% and 9% and revenue of $46 million to $51 million. What factors are you seeing that might impact that guidance?

Yes. Well, obviously, one of the things that we want to ensure that we do is that we -- when we put guidance out that we achieve that guidance. So making sure that we obviously that range is something that is achievable for the business. There's obviously upside. So we may do better than that. We have made a couple of little investments as we talked about some of the new headcount in some new regions. We're seeing strong growth outside of Australia. So we might see -- continue to see more of that in some of those regions. Obviously, the other thing that we're heavily focused on is making sure that we're managing the cost base well. And the only other change that would really impact it was obviously the unknown. We could see a backward step in the economy might impact us. Our mix of clients actually kind of protects us a bit from that. We've got lots of different clients that we work with agencies and obviously having more diversity of revenue in different locations should help protect us from any of that. And so then the only other thing would be is if we decided to make any changes from that investment perspective, that might mean that we -- it would be maybe at the lower end. But yes, as we said, we've been pretty open about the investments that we've made. And we typically, yes, should start to see some of those investments paying off predominantly towards the end of the financial year.

Terrific. Okay. Well, with that, let's now actually wrap it up. So congrats again from me to you on today's results. Martin, I'll hand back to you for any closing comments.

Yes. Look, thank you to the IR department and all of the shareholders that continue to support us as a business. We organically continue to grow top line and now bottom line. And we've always done what we said we were going to do. And so we expect that to continue, as Mel just said. But thank you to everybody and obviously, the amazing team we have around the world and fantastic close to 800 clients. Thank you.

Terrific. Okay. Well, with that, thank you to everyone for joining, and I'll invite you all now to disconnect. Have a great day. Thank you.