The Alumasc Group plc (ALU) Earnings Call Transcript & Summary

Good afternoon, and welcome to the Alumasc Group plc Half Results Investor Presentation. [Operator Instructions] The company may not be in a position to answer every question received during the meeting itself. However, the company can review all questions submitted today and publish it, if that is appropriate to do so. Before we begin, I would like to submit the following poll. And I would now like to hand over to CEO, Paul Hooper. Good afternoon to you.

Well, good afternoon, everybody, and thanks, Alex, for the introduction. A very big welcome to the Interim Results of the Alumasc Group for the year '24-'25. My name is Paul Hooper, I'm the Chief Executive, and I'm joined today by Simon Dray, the Group FD. By way of introduction, we'd like to cover a couple of slides at the start of the presentation here. Simon's just going to. And sustainability drives our future growth. We have 3 divisions with a diverse range of products and markets. And I'll touch on the first, which is the water management, and this consists of a metal building drainage, including surface water drainage, metal gutters, down pipes, and specialist access covers under the brand name of Gatic. Our second division there is in building envelope and this consists of our roofing business. and predominantly flat roofs, including green roofs. And then our third division, house building products, which range really from loft door sweeps, to tile vents and in effect really from the ground level to the top of the roof of a house. So looking on to the next slide. These are our growth strategy pillars. This is a summary for reference, and you'll see more detail as we touch on each division. But we're championing sustainable building products. We will accelerate organic growth drive operating margin improvements to achieve the targeted 15% to 20% operating margin. And we're going to invest our capital and revenue to enhance future growth. So we can turn now to Page 7. These are the highlights of our first half of the FY '25 year, and we've had a record half 1 performance in what a challenging end market conditions, particularly in the U.K., where Experian indicates for 2024, there's been a reduction of 5% in activity, construction activity. We grew our revenue by 20%, and we grew our underlying PBT by 19%. We've had organic growth in all 3 divisions. In fact, all 3 divisions have moved ahead of the prior year as we did and managed to achieve in the full prior year to June 2024. We've had an excellent performance from ARP, and you may recall, this is a business that we bought just over a year ago, and it exceeded expectations. We've had strong cash flows, in fact, 127% operating cash conversion. And the balance sheet is in a very strong stage with the 0.3x leverage there, which we'll come on to later on what that means for us. We took the opportunity to take up the dividend to 3.5p. Moving on. The delivery of strategic priorities are driving market outperformance and the successful execution of these and commercial priorities have really made a difference. Our organic revenue growth has been 8%. Overseas sales growth has been 43%. And that's been assisted by the acceleration of the Chek Lap Kok Hong Kong airport order. We've had resilient domestic sales. That hasn't just been exports it's been the U.K. as well, and that was ahead by 3%, and that is outperforming the challenging U.K. market, which I just touched on, was down by 5%. We managed to keep our underlying operating margin stable at 14.1%. And just to remind ourselves that [ 80% ] of our portfolio is aligned with strong environmental growth drivers, which we see as a definite advantage. We closed our facility in Dover in December and move the manufacturing of Gatic access covers to Halstead, which is the facility that came with Wade when we bought that a few years ago. And this has been very successful. And we started manufacturing and we estimate that we will save circa GBP 800,000 a year from this. And you'll see a little bit later on that we will have improved products from this move as well, which will give us a competitive advantage. We have significant headroom to support future growth, and you've just seen that refer to with the balance sheet gearing. We have a clear line of sight on delivering our growth ambitions. It's pretty much more of the same. And there'll be a continued out performance of the U.K. construction market. So pretty much more of the same, doing what we've been doing and in our H2, we'll start to get the benefits of the GBP 800,000 saving that I've just touched on. And the acquisition synergies from ARP will start to come through more strongly, where we estimate overall that there are benefits savings actually purchase savings of circa GBP 0.5 million there. So now I will hand over to Simon to cover the financial review.

Thank you, Paul. And I will start with our income statement. As Paul mentioned, revenues were 20% ahead of the prior half year. 12% of that growth was due to an incremental 6 months contribution from ARP, which was acquired at the end of December 2023. Organic growth, so like-for-like growth contributed to the remaining 8%. Margins, both gross and operating, were stable. Raw material prices weren't significant in the period and inflation in other costs such as labor were mitigated by active management of costs and prices. Our underlying profit before tax was GBP 7.5 million. 19% ahead of the prior half year, 11% of which was organic growth and 8% was from ARP. The tax rate on our underlying profits was slightly below the prior period due to the mix between U.K. and overseas profits. So our underlying earnings per share was 22% ahead. And the Board has declared an interim dividend of 3.5p, about a 1.5% increase from last year's interim. And in the period, we reported GBP 700,000 of non-underlying restructuring costs related to the closure of our Dover site. As we indicated last year, we expect these costs to total GBP 800,000 by the end of the year, with a further GBP 100,000 during the second half of the year, although any profit from the disposal of property will offset this in due course. Our revenue and profit bridges analyzed out of the split between inorganic and organic growth. Excluding the contribution from ARP, very pleased with the all 3 divisions contributed to organic growth, as you can see in the gray boxes. ARP itself Contributed GBP 5.7 million of sales. And after interest on the acquisition consideration GBP 500,000 of underlying profit. Our operating margin was stable at 14.1%, consistent with the prior half and prior full year. We'll cover on a later slide, our operating margin target and the opportunities to achieve that through strategic actions and through volume growth. And now looking at our cash flow. We had a strong cash generation in the period with operating cash conversion. Essentially our ability to convert pretax post-pension operating profit into cash was 127%. We have significant destocking during the prior year. But pleasingly, we saw a further GBP 1.1 million inflow from working capital in spite of the volume increases and some higher stock holdings to offset extended lead times caused by the Red Sea prices. Our average trade working capital reduced from 16.7% of sales to 14.8% of sales. And these strong cash flows allowed us to continue to invest in our future growth. We have GBP 2 million of capital expenditure in the period, GBP 400,000 of that related to the completion of the project to relocate and automate the manufacturing of our access cover business at Halstead following the closure of the Dover site and a further GBP 700,000 was spent on Timloc on further automation and to support its new product development efforts. And ARP's strong performance meant that the final earnout GBP 750,000 was paid in full in January, just after the period end. Net bank debt closed at GBP 4.6 million, a 37% reduction since June 2024. A couple of key points to highlight on the balance sheet. Our debt facilities are GBP 25 million, extendable to GBP 45 million through what's called an accordion agreement, which allows us to upscale the total bank facilities without renegotiating the agreements, and they're committed until August 2027. Our net bank debt of GBP 4.6 million represented gearing. That's net debt divided by our 12-month trailing EBITDA. Essentially, a measure of how big our debt burden is relative to our earnings of a modest 0.3x compared to 0.5x at the last 2 reporting periods. We retained substantial headroom against both our covenants level, which is less than 2.5x gearing and our 1.5x internal debt [indiscernible]. And our defined benefit pension scheme funding position improved again on strong growth asset performance and higher bond yields, which lowered the present value of the liabilities. At December, we reported a GBP 3.3 million accounting service, which compares to a GBP 800,000 surplus at June 2024 and a GBP 4.8 million deficit at December 2023. While the accounting valuation doesn't reflect the basis on which we agree funding with the trustees, the scheme is now approaching a self-sufficient position, where the assets can be held in low-risk investments, which effectively hedge the majority of the liability risks. While the company still retains an obligation for the scheme and it remains on the company balance sheet, the company is required to meet the cost of running the scheme. There's a low risk of the company needing to pay further deficit repair contributions. Our next triennial is in March this year, where we'll be seeking to agree with the trustees and affordable level of contributions, which reflects the improved valuation while also keeping some further derisking options on the table. My final slide in this section reflects on our performance against our financial key performance indicators. Our first target is revenue outperformance. We've achieved a compound organic revenue growth of almost 6% in the 5 years to June 2024 against the flat overall U.K. construction sector. In the current period, we grew revenues by 8% organic in a sector that declined by between 3% and 5%. Our operating margins have grown over the 5 years to 2024 from 9.8% to 14.1%. This period, margins were in line and allow achievement of our target range of 15% to 20% will depend somewhat on volume growth. There are some strategic actions, which Paul will cover later, which will begin to feed into the second half. And strong cash generation is an important enabler of our strategic growth. Our cash conversion in this period was at 127%, well above our 93% average over the last 5 years and our target of at least 100%. And finally, we continue with our carbon reduction activities. With scope 3 emission calculations, which cover our entire valuation. Our valuation chain, sorry, including sourcing and logistics performed for the majority of our businesses. Target setting and accreditation activities are underway and we expect to publish the results later in 2025. And I'll now hand back to Paul for the operating review.

Thank you very much, Simon. So we have 3 divisions. And once again, during this half year, all 3 divisions have an improved performance versus the prior year. And I'll start with Water Management, which is our biggest division. And it had a record performance. And you can see that the revenue and underlying operating profit grew significantly circa mid-30% growth there. We had 6 months benefit from the contribution from ARP that was acquired just over a year ago. And we had organic growth in revenue of 9% and operating profit of 11%. We had a terrific export performance where it grew by 42%. And we had faster-than-expected call-offs from the significant Chek Lap Kok Hong Kong airport project. We have a growing pipeline of opportunities from expanded overseas sales team. And what does this mean? While excitingly on Friday, we received our first order for Brazil for port there, Suape port. And although not material, it was still very significant to us with several hundred thousand pounds value, but this is our first project in Brazil. And we put somebody in there a year ago into Latin America, into Colombia actually and he's doing a fantastic job, and it just shows what we can do with our products in other parts of the world. So we're very excited. I'm particularly excited about this. Because there are areas like Peru where they've gotten military and several airports et cetera, Mexico, Chile, et cetera. And we really haven't gone there in the past. So I'm very excited about this. and I feel, although it's not huge, the first project, it's still a breakthrough. Meanwhile, we've had resilient U.K. revenues. And we've invested in leadership positions. There's a new MD for this division, which, in effect, replaces me, which I've been doing for 5 years, pretty much part-time. It will allow me to focus on other chief exec responsibilities like acquisitions. We've brought in experienced operator in, and we've also brought in experienced export sales director. This is part of our succession planning because the incumbent will retire at the end of this financial year, having done a really good job, being with us for 40-odd years. And then from H2, with the automated access cover manufacturing move to Halstead, GBP 800,000 annualized saving, ARP synergies, GBP 500,000 over time, we will start to have the improvement -- further improvement on the margin. And hey, this is a picture of 1 of the first products coming off the production line, if you like, at Halstead. And can you spot any lead filler in there? Well, please help me know, if you can because there isn't any there. And actually, this is a beautifully machined product. It is better than the competitors now without doubt. They used to be the spoken individually crafted at Dover, a process that's probably being carried out for 80-odd years. So we're saving GBP 800,000. We got a better product, and the first shipment of this has gone into Heathrow and the contractor is delighted with the end product. So this is innovation, and this is investing, wanting better products, wanting to save money, too. So that's Water Management. And then our second division is Building Envelope, which consists of our roofing company. And this also grew its revenue by 8%, its operating profit by 6%. It talk market share. It's by hiring really good salespeople that it's achieved this and having new products available, and it's had a metal roofing standing seam, called liquid systems, et cetera, as shown at the bottom of the page. And those are all held. And then the margin is from the investment in our sales capability and regional coverage, strengthening that. But we've also had to invest in other linked to the Building Safety Act compliance on products and on training, and that's cost us a few hundred thousand, but it's probably going to be a barrier to entry over time. We're very happy to be spending that money because it puts us in a good position. We need well-trained people as well. So I've talked about some of the new products there, but an interesting aspect where this business has been successful, has been by nurturing and bringing in some large clients that might be high street shops. There might be other companies that have got a lot of buildings around the U.K. that need refurbishing over time. So we've got a site of the future, and this -- these will run for several years, and that's good to have in your portfolio. So we're pretty excited about that as well. And then finally, I shouldn't call it the third division because this business -- this division is making a 25% return. It's really well run. It also had a record H1 performance. And that's against a housebuilding market has declined by 7%, but it's moved ahead with its revenue ahead by 6%, it's profit ahead by 8%. And it's done that from outstanding customer service, 100% OTIF and also bringing new products in. You may recall the tower vents that we've had launched around 18 months to 2 years ago. We reckon we've taken about a 10% share. And all of these things about have helped to offset the decline in the market. We've invested further in some equipment in H1, and this increases the -- improves the efficiencies and the cost management, and it has increased that operating margin by [ 0.5% to 25% ]. We're well positioned to support any demand recovery. In other words, the market lifting up because we're pretty cost efficient. We reckon we're probably the lowest cost manufacturer. It's highly automated and robotics all over this plants. And we're focusing on sustainability, which supports the drive for lower carbon homes. We have substantial manufacturing capacity. We estimate that to be in the order of 50% plus. So this business is very well run. It continues to grow. It just had a record H1 as the Water Management equally, our roofing business has also grown in H1. So how are we going to keep this going? We want to accelerate our growth. So we have various strategic priorities, and the first one I'll touch on is accelerating our organic sales growth. The photo here looks as if this is our latest robot. It's not actually. It's a play area and it's demonstrating our -- in the photo, the way linear channel train system. But we've grown, as you've seen, our revenue, both in the U.K. and overall against the very challenging market. We are fortunate in having long-term growth drivers assisting us in terms of 80% of the product portfolio is subject to regulations and legislation and 80% of revenue is derived from environmental solutions. So when the markets recover, we will be in a good position to take and increase our volumes. And meanwhile, we'll continue to take market share gains. So moving on, this is exciting. This is our overseas area, which we grew by 43%. We shipped into Australia [ soft train ], we shift into Saudi into [ Neon ]. We've got a guy permanently positioned now in Dubai. We're looking to move into the Philippines and Thailand and more representation in India over time. Singapore, there's going to be increased work there, which we're excited about. And we are also, as I touched on, very excited about Latin America and what can be achieved there. We're only, I think, scratching the surface. Our products are really good. They're as good as our competitors, if not better, along with our technical support, et cetera, in our marketing, and we're going to grow this. So it's an exciting time for us actually. And I'm so over the moon as you probably gathered by that Suape Port, we're in one of the biggest courts in Brazil. It's a start. So how are we going to drive our margin improvement. We've said we're going to hit 15% to 20% as an operating margin. We're at 14.1%. We've touched on the GBP 800,000 saving. We've touched on also the ARP synergies of circa GBP 0.5 million coming through over time. But we'll wait and will be assisted by the U.K. market recovery. The overseas growth will assist us, that's more in our own hands and that's what we'll be pushing hard on so that we can make that happen, too. But we can grow this operating margin. We have grown at 435 basis points from 2019, moving as Simon touched on, from 9.8% to 14.1%. Of course, we can move in further to 15%. And that's what -- 15% plus, and that's what we'll be doing. So, if I may, Simon will touch on the next slide, please.

Thank you, Paul. Well, we believe a very important factor behind the group's performance over the last 3 years -- over the last 5 years and its future growth potential as well. It is our successful alignment with markets that support the shift towards sustainable construction. Over 80% of -- the group's revenues is derived from 1 of our 3 environmental pillars there, either reducing a building's carbon footprint, either by reducing embedded carbon at the point of manufacture products that are typically highly content recycled material, and they are low life cycle carbon products, but also by reducing operating carbons for the energy building users, while it's in use. And they do that by controlling ventilation, improving insulation and some of our roofing products also absorb atmospheric CO2 to reduce the building's energy footprint. We also improved buildings, climate resilience by managing rainwater and attenuating stormwater. And we also provide biodiverse green spaces within the urban environment. And our market demand is supported by building and planning regulations, addressing decarbonization and building quality and safety. I'll pass back to Paul now.

Thank you very much, Simon. So what are we going to do about our value-enhancing investment to grow organic -- to get organic growth? While we are investing for the long term, and that's including the sales of people and Building Envelope, we'll continue to do that. We'll continue to invest ahead of the game, and it's paid off. And we will continue to do that. We're taking market share. That's the real litmus test with these things. We've invested in senior management, the divisional MD coming in towards the management, that will bring new energy along. And the export divisional or the export sales resource as well in water management is a positive, very experienced people coming in to both of these positions. I touched on the access covers automation. All of that will help in terms of cost savings and better products and we will continue to develop new products, particularly, but not exclusively in the housebuilding products, and that tower vent is such a fabulous example of bringing new products in to offset a decline in a marketplace. But we wanted to be supported as the market recovers, and then we'll be able to move even further forward. We have strong cash flows, and we have a strong balance sheet that will support further investments. So Simon, would you now cover the next slide, please. This is a really interesting one on M&A.

Thank you, Paul. Yes, M&A acquisitions have been an important accelerator of our growth strategy. And we hope that they will be going forward as well. The left-hand side of this table shows the characteristics we look for in an acquisition. Principally, we look for both opportunities, typically up to around GBP 20 million enterprise value and businesses which operate in markets, so we have a good understanding of our current markets or close adjacent markets. We also look for businesses that are consistent with our group targets and strategy, particularly regarding sustainability. And there need to be businesses that we believe we can grow and ideally bring synergies into the group. And to illustrate that, there are some case studies set out on the right-hand side of some of our recent acquisitions. As you can see from the initial return on investment, ROI, we look to pay a fair price for good businesses with moderate initial returns on investment based on that performance at the point of acquisition. However, critical is our ability to grow these businesses through implementation of our strategy and in many cases, the synergy they bring with the rest the group. You can see from the ROI actual target, we look for and have a substantial growth in acquired businesses current or near-term expected returns. And in that way, we create value for our shareholders. We have a pretty good pipeline of opportunities. We have a long list of companies, which are being marketed at the minute, but we keep an eye on. 1 or 2 of those, we are getting some traction with so we are hopeful that we will be able to progress with something over the next 12 to 18 months. Paul?

Thanks, Simon, and this is our final slide, which is the outlook. And after an excellent H1, we expect a continued resilient U.K. performance despite the persistent demand headwinds. H2 export growth is likely to normalize. We'll have strategic progress on margin targets from further efficiency improvements that we've touched on, including the Dover Plant closure. We expect a minimum impact from the NIC NLW increase. It's around GBP 600,000, but our record is good of recovering cost increases, which might be down to cost reductions, efficiency gains, gains and price adjustments. We've demonstrated our quality of our businesses and the capacity to deliver medium-term growth plans. We have a diversity of end markets. We have the export potential, which is really there. And we have the strategic alignment with a shift to sustainable construction, which helps us. Product innovation, that's more of the self-help, and that will continue. We have an experienced management team best-in-class service. And we have operational excellence, where we believe we are one of the lowest, if not the lowest cost producers, depending on which division. And the Board remains confident in the group achieving its full year forecast. There is a clear line of sight to deliver long-term shareholder value, and it will be more of the same, and we've outlined the strategic moves that will make that happen. And if we reflect over the last 5 years, we've consistently improved this group. And as Simon touched on, that 435 bps movement to 14.1% from FY '19 is quite significant. So we can do it, and we're going to continue to do it and to build that to the 15% to 20% operating margin. And we have the capability both in terms of our sales and improving our efficiencies. We're constantly looking to see how we can make improvements on both of those areas. And the end result is good. So we're pleased. We're not complacent. We're quite pleased with progress so far. And we want more, and that will also include an M&A activity, where we've had a good record. We've had good synergies coming through over the years as well. So I think that's really it, other than to thank you all so much for attending. We've got some questions, and then I will just say a few words at the end. So thank you very much.

[Operator Instructions] Paul, Simon, as you see, we have received a number of questions throughout today's presentation. And Simon, if I may now hand back to you to chair the Q&A, and I'll pick up from you at the end.

Thank you very much, Alex. So Paul, first question is for you. When will the company move itself onto the main markets?

There are no current plans to move ourselves back onto the main market. I'd say never say never. But we are very conscious of -- there are some investors that are invested in us, because the IHT benefit, even though that would have been changed, to some extent, in the budget, of course, I think it's been halved. But nevertheless, there are institutions and individuals out there, we've got an IHT reason for investing in us. And actually, overall, our share price has moved up significantly, I would say, in the last year. So from that point of view, it seems to be working quite well. But we will continue to keep the situation under review.

Thank you, Paul. The FT report that U.K. businesses are set to offload GBP 70 billion of pension risk to insurers, why can't Alumasc do the same? Would it not reduce risk and make the company more attractive?

This one is for you, Simon.

Yes. Well, [ Gerard ] is referring here to the pension SKU -- demand benefit pension scheme, and there are essentially 2 options for a late-stage scheme like ours. You can either hold it on the balance sheet and run on a self-sufficient basis, like Plan A, if you like, or you can pay an insurance company to take it off your hands. And the simple answer to the question of why then we pass it on to insurers is, it doesn't represent good value for money for our shareholders right now. We continue to keep it under review. We will have a better idea of what ongoing cash flows look like post the triennial review and trustees. And I think the likely outcome of that, as I've mentioned, when we covered it, so is that we will agree some level of contribution basis, which keeps some further derisking, including partial off from insurance buyout under the table. But to do it right away, I think would not be good value for money. See who wants to do this one. On the dividend increase of 1.44%. It doesn't reconcile one bit on the positive tone of your RNS. Why haven't you had the confidence to increase it more?

Why don't you handle that? I'll add further.

Sure. Well, what we were doing, we weren't trying to send a message with our interim dividend increase. We look at these things on a full year basis. So we are -- once we -- if we're in the business, it falls in the second half in line with the Board's expectations, then we would expect to increase the dividend by more than the increase seen at the half year. But we're not trying to set the message. We are just looking to show a little bit of progression and review in the full year.

Which was what we did last year, and we had somewhat of an uplift in the -- for the final dividend.

Yes. How much do you pay into the pension fund looking to sell the fund to an insurer? Well, I think that the latter part of that question we've covered. Our current contribution level is GBP 1.2 million per year. Going forward, the discussions with the trustees are likely to revolve around how much it's going to cost to run the scheme, the expenses of the scheme itself, plus a moderate level of contribution to keep, as I mentioned, derisking option is on the table. But I don't know more of that, I can't give you more than that until we've sat down with the trustees. How is the sale of the Dover size going? Have you had some interest from prospective purchases?

Sales. Yes, it's going quite well. We have had some interest. We are still finalizing the clear-up of the site because it was manufacturing up until a few weeks ago. But there has been interest, but we're not -- I would say, we're not close to selling it, but that could change if the 2, 3, 4 people who have been around, et cetera, start to show further interest and want to accelerate that. But it's not without interest, let's put it that way.

Well done, Paul, Simon, and all of Alumasc. Great results and prospects.

Thank you very much.

Thank you. How many staffers do you have versus, say, 5 years ago? How many employees?

Well, gosh, right.

Well, I know from 5 years ago, we'd likely to have fewer employees in because we've sold a business called Levolux, and we have just closed our site in Dover. So we are -- there will be a slight downward trend in that numbers. But I think we're about 450 employees.

I can give you that exact -- it was something that we necessarily publish.

Not every 6 months.

Yes, 495. Yes, it's not far off.

Consistent but a bit lower...

But that would have included some of Dover. So you can take actually, there will be around 15 or maybe slightly less. Sorry, 12-ish. So yes, and 5 years ago, it would have been a lot more. I haven't got that number with me.

Do you contemplate international manufacturing expansion overseas remain an export business for the foreseeable future?

Well, again, never say never. But at the moment, our expertise, our investment in modern equipment, et cetera, is all in the U.K. But over time, then we made it -- it's a question of the cost of shipping versus the investments and the size we can build a market out to, but it would be a possibility over time. But I don't think we're near that at the moment for several years, to be honest.

Okay. Then how is the ERP system performing for the business now? Yes, that's the references. With the implementation of a new system in our 2 biggest businesses, we happened 6, 8 months ago, something like that. They are now going through the system, which is a lot more stable now and gives them a lot options in terms of understanding the business and they are implementing the changes as we speak. They're starting the process of our improving system. What has improved a lot over the last few months is CRM, customer relationship management data and the sales marketing teams are increasingly using that to better direct their efforts.

And the next one is yours.

Okay. Well done on the strong cash flow generation. How long working capital continue being positive, particularly as you continue growing the business. That's a good question. And I would say, I was very pleased that we had some inflow from our working capital in the 6 months. I think 14.8% of trade working capital as a percentage of sales is probably a reasonable place to be. And I don't anticipate squeezing much more out of that until we really get into the ARP synergies and the ERP benefits, that we might see a little bit more coming out. But I think their medium-term targets. So I'm not expecting too much more to come out to that certainly in the next 6 to 12 months.

I think you've got a number on that next one for example.

Yes. Innovation. What percentage of sales is from new products. So I think in the last report, we don't publish it every 6 months, but in the last full year, it was about 16% of our sales were from products launched in the last 3 years. And that varies from division to division. Timloc, it was about 22% to 23%, I recall. Paul, do you want to comment on that?

Yes, I have got a view on this, and that would be over time, I'd like it to be near 25%, certainly 20% to 25%, but over time to get to the 25%. I think that's a healthy percentage because it really is true that if you launch what is actually a new product and something that's innovative, you will get better margins on that until the competitors catch you up. And what you need is a flow of other new products coming through that will continue to come into the businesses. So that's what we'll be doing. And yes, and it's always exciting launching new products, too.

Fantastic. That's great. Paul, Simon, thank you for addressing all those questions from investors today. But before we direct the investors to provide you with their feedback, we think it's particularly important for the company. Paul, could I please ask you for a few closing comments?

Yes. It's just a very big thank you for your support today and for your kind comments with the great questions as well and really just being here attending and showing interest in our business. We feel we have come a long way in the last 5 years. This hasn't been an overnight wonder. And we've got a lot of plans really there for the future, where we're going to grow this business even further. And we feel that now is the time that we're hopefully getting credibility of being able to deliver and against the difficult marketplace as well. So when the markets return, we hope that we'll be able to move further forward. And yes, we've had a strong H1 and we I expect to be able to continue growing the business. So thank you very much indeed for your attendance.

Fantastic. Paul, Simon. Thank you once again for updating investors today. Could I please not to close this session as you will now be automatically redirected to provide your feedback in order that the Board can better understand your views and expectations. This will only take a few moments to complete and I'm sure it will be greatly valued by the company. On behalf of the management team of Alumasc Group plc, we would like to thank you for attending today's presentation, and good afternoon to you all.