Audioboom Group (LSE:BOOM) — Interim Results

0:01 Good morning, ladies and gentlemen, and welcome to the AUDIOBOOM GROUP PLC Interim Results Investor Presentation. Situated on the right hand corner of your screen. Type in your questions at any time and press send. The company may not be in a position to answer every question received during today's call. However, the company can review your questions submitted today, and we'll publish those responses where it's appropriate to do so. We'll now submit a poll. If you could give that your kind attention, I'm sure the company would be most grateful. I'd now like to hand over to the management team from AUDIOBOOM, Stuart Brad. Good morning to you both. Thank you. Good morning, everyone. Special day today, and you got us both in the room together, I think, for for for the first time on on one of these. So it's good to be with you. For those of you that that don't know us, I'm Stuart Lasser, CEO of AUDIOBOOM.

0:49 I've been CEO for the last six years and been with AUDIOBOOM for just over a decade, actually. So I'm pleased to to to be with you today. Yeah. Thanks, everyone, for joining. I'm Brad Clark, CFO here at the AUDIOBOOM GROUP. I've with the company since March

1:03 2018. It's been quite a quite exciting week for the company. So I look forward to taking you through that today. For those of you who will be regularly joining us, I think this presentation will will be slightly different. I think we'll we'll spend the first half just focused on year to date performance and and results. Second half, we'll focus more on the transaction, give you more detail there, walk you through that, and then as always, a a q and a session at at the end there. So, yeah, forty

1:35 five minutes today and it will be split up and and presented to you in in that format. So, yeah, and key parts for for today's meeting, as I said, we'll look at h one results first. We've continued that positive growth story, positive results. Everything is expected on track to deliver a record performance for 2025. As you know, as you saw on on Wednesday afternoon, we also initiated first steps in our accelerated growth plan, our m and a strategy with the acquisition of Abolishes Limited. So we'll give you more detail on that one. I think one of the key parts being that overnight, we created the the second largest podcast network in in The UK. We'll talk more about the the rationale behind it from a strategic point of view.

2:28 And and then obviously, we're just keen to to stress that that this transaction just makes so much sense. It's immediately earnings accretive, in 2025 and and full year '26 as well. So I think a a a great deal, and a fantastic step forward for the business. And then we'll talk more about some of the operational highlights in each one, continued expansion of Showcase, which you know is is important to our growth going forward. The launch of AI in the platform, just some important steps to continue that organic growth alongside our first steps on the inorganic side. So, yeah, really great week for us and Asang to tell me more today. Just step back once here and just kind of give anyone that's new to AUDIOBOOM this week. Just a little insight into the the business model and and and what we do.

3:21 AUDIOBOOM operates in a podcasting industry or a platform business, And the platform does very a very important, very key job of connecting three elements of podcasting together to create that value at scale globally. So the AuditBoom platform works with podcasters and creators. It connects their content to audience by distributing that content out to all of the major podcast listing apps like Spotify, Apple Podcasts, and Pandora in The States. And then we work with more than 10,000 advertisers to to monetize that that content. So with our AUDIOBOOM at the heart of that, connecting those three elements together, there is a there's limited value in in podcasting. AUDIOBOOM does this very well.

4:09 At scale, we have more than 8,000 podcast channels running through the platform, 35,000,000 plus unique monthly listeners, and that's before the Abalicious acquisition and more than a 100,000,000 monthly downloads. As I said, more than 10,000 brands advertising with us. We partnered with podcasts. We we partnered with them and that partnership is to have exclusive distribution and monetization rights. That's how we work with with with podcasts. Out out of it is 8,000 plus channels. There's a core group of 250 major podcasts and the biggest podcasts in in the world that really drive the distribution and monetization of this platform.

4:54 If you listen on Spotify or Apple or elsewhere and you click play, that piece of content will be delivered from the AUDIOBOOM platform that allows us to attach advertising and and to monetize that that content wherever it is listened to. And then with on the advertising side, we have two ad products, two major ad products. One is our premium ad product. One is showcase our our marketplace, which I mentioned a few minutes ago. The premium ad product, that's when the host of the podcast is delivering the ads in their own voice. They're endorsing the product. Their audience really trusts the host. They go out and buy the product. It's immediately measurable for the advertiser. This tends to be brands that are smaller. They're disruptive brands. They're to consumer brands, but they love podcasting because they can see the results of it immediately, and they can drive revenue through their through their their podcast advertising.

5:46 And then Showcase, that's our marketplace. It's built around the advertising tech. It's very efficient. Showcase is used more by bigger global blue chip brands because they like the scale and the efficiency that it offers and also the targeting capabilities that that that it offers too. So within Showcase, if an advertiser, let's say Procter and Gamble wants to reach 25 to 50 year old females in the Northeast Of America with household income about a $100,000, we can offer that targeting to the brand and that that that's a great thing for them. With the recent addition of of AI, which we'll talk about a little later into it to showcase, we're able to offer them other tools like brand safety tools that are very important to them as we do more and more work with those bigger blue chip global brands.

6:39 So that's a, I think, a very kind of quick and hopefully clear overview of the AUDIOBOOM platform and what we do every day within AUDIOBOOM and and what we're we're really focused on here. And then we'll walk through our h one twenty twenty five performance, and then then Brad will give you some, you know, more focused detail on some of this. But in terms of revenue for for h $135,100,000. Mostly up on on on last year, but as we've kind of been talking about over the last twelve months, our real focus has been delivering higher quality revenue. And you can see that that happening here, 7,400,000 of of gross profit. So that gross profit line, what AUDIOBOOM retains after revenue shares with those content creators with those podcasters at 7,400,000.

7:35 That's up 30% versus the the same period last year. And then again, you can now see that that gearing to to to EBITDA as well. 1,800,000 of adjusted EBITDA in h one, up 500% versus the the same time last year. So, you know, still looking at that top line growth, but it's gonna be higher quality revenue that will flow through our p and l and start to to get EBITDA. As you can see that we we've done significantly last year. So we continue audio BOOM on standalone pre acquisition basis, still continue to to be on track to deliver the the 80,000,000 and and 4,500,000 adjusted EBITDA that the market expects.

8:23 Now obviously with the acquisition of that changes updated broker market expectation of $83,200,000 for the year and $4,900,000 of adjusted EBITDA. Again, we'll give you more detail on that when we talk about the the Atlas acquisition. As it stands today, AUDIOBOOM on a stand alone basis has more than 70,000,000 of that first 80,000,000 books that's already on on the books. We're ahead of 5,000,000 ahead of where we were at this point last year and you can kind of see that pathway I think to to delivering that that record year for the business. And then showcase as we mentioned earlier on just continues to be that fastest growing part of our revenue mix. And the key thing there with Showcase is that higher gross margin that it comes with. So 24% year on year growth H1 of this year to last year, really a key part of of our work and our focus going forward is to continue growing showcase that will deliver the stronger gross margin, gross profit and more geared EBITDA across the second half of the year.

9:35 Brad? Yeah. Thanks, Stuart. So you can see guys the change in revenue contribution first half of this year versus first half of last year. And as you have said, we've seen an increase in those revenue lines, which contribute higher gross margin being showcased at 30% and premium at 20%. So in the detail for the first half of this year, premium warehouse endorsed the endorsed products. That grew by 1,600,000 or 9% up to 19,500,000. Showcase increased by 24% or 2,300,000 up to 11,600,000. Psych, our third product where we so effectively a brand agency placing spend across any globally available podcast. That contributes 15% of gross margin. That decreased by 2,900,000 or 43%.

10:32 So we've seen AUDIOBOOM increased by 3,900,000. SOMIC increased by 2,900,000, hence our gross revenues increased by a million dollars. Now the point to note with SOMIC is that we've seen we're going to see a shift in spend this year versus last. So for 2024, we saw spend weighted towards the first half of the year lowering in the second half. This year, what we'll see is lower spend in the first half and higher spend in the second half of the year because the spend is concentrated around the Fantasy Sports NFL season. We'll see that increase as we go through second half of the year. So we can see that in detail there on the contribution. We've seen that gross profit increase by 30%.

11:18 And as we'll see shortly, it will develop relatively stable fixed OpEx base. We've seen that EBITDA increase six times in in the first half of the year versus last. Okay. We can see the revenue trends here. There's seasonality in the revenue that we recognize at AUDIOBOOM where it's weighted towards the second half of the year that happened last year. It's gonna happen again this year. We can see that revenue trend on the top left

11:44 hand corner. The top right hand corner, we can see the gross profit increases, and we can see that gross margin increasing as well. So to those new to the story, the gross revenue that we recognize is the the amount that we invoice brands. So we collect that. Cost of sales is what we pay to our podcast partners, and that leaves us with the gross profit or net revenue. You can also call it that in terms of what AUDIOBOOM retains. So our gross margin for the second quarter reached 23%. And actually in June, it reached 25%. So we can see that as you can see that scaling as we went through the year. I wouldn't expect it to go above that level. We can see good progression on that gross margin versus versus last year. The bottom right hand corner, we can see what we call as minimum guarantee true ups.

12:33 So when we enter into agreements with our podcast partners, we guarantee them amounts of revenue over that contractual period. Because of the seasonality in revenue, there may be instances where we true up to that minimum guarantee level. And because our revenue is weighted into the second half of the year, we may see minimum guarantee true ups at a higher level in the first half, and then they're lower in the in the second half of the year. We've seen that percentage reduce back in 2023. There was challenging advertising market conditions. The company restructured a lot of this a lot of its contracts, and we've seen this non guaranteed troughs for, you know, fall to a lower level as we've as we've gone through the last few quarters. We'd expect those to still be there in the second half of the year, but at a lower level.

13:21 And that's good for our gross profit recognizing higher gross margin as those those commitments are met, and we'll see that through the second half of the year as well. And this is the OpEx base that I mentioned earlier on. So that's been we can see that over the last year and a half. And that's been very, very stable, about $2,900,000, $2,800,000 a quarter. 60% of our cost is in relation to salaries and commissions. We've got 42 heads within AUDIOBOOM before the acquisition. That 60% of cost is related to that. 20% is in relation to technology costs and remember platform that we have for AUDIOBOOM. But that CapEx base has been very, very stable. Hence, while we're saying once that revenue grows, once that gross margin grows, more of that's gonna drop down to the to the profit line. We're we're expecting that to go forwards. We'll come to our delicious shortly on an OpEx base, rather than around 250 to $300,000 per quarter. So you will see that next time increase, but that's because of the acquisition of the fundamentals still stay the same in terms of relatively stable OpEx base within the company.

14:36 And in terms of the cash and working capital cycle of the business, so the cash collection cycle continues to work well. I think a 103% of revenue booked in the first half of the year. What we noted in q two was that actually reduced to 93% of of of of invoicing in the second quarter. So what we saw was that we collected a significant amount of cash post quarter end as our customers preserve their own cash. What we've actually seen as well is a number of new agencies that we're working with have slower payment terms. So more towards the more towards the ninety day mark, which has impacted that that cash out. As we can see from the right hand side, the amount that's provided for in terms of any bad debt actually as a percentage of revenue remains at a very small level. So in the first half of this year, $90,000 against just over $35,000,000 booked is a very, very small proportion. So, simplistically, once we invoice that amount, we're very, very certain of collecting it. But there is we have noticed that trend of debt has been slightly slower to pay.

15:44 We pay our leading podcast partners on thirty day terms, collecting on a on an average of eighty days. So there's a timing difference between paying people and collecting. But we are very, very good at collecting, and that's what we're gonna be focused on very well during the second half of the year. What we noticed during the third quarter is that revenue increased in June. It will set off slightly in July, so we're paying lower revenue shares at the start of the quarter but collecting on the higher revenue months of the end at the end of q two. So we should expect that cash position to improve slightly as we go through the end of the quarter. And also as well, the company does have a numerous contract, which is unwinding. That finishes at the end of December. At the end of June, we have 1,500,000 of that provision left. That will unwind.

16:30 And as we step into 2026, the company will not need to pay between 250 to $300,000 per month to true that contract up. So the cash will be retained within the business. And you'll see from the forecast that we expect cash to be relatively flat this year. And then as we get into 2026, at the end of the end of the increased performance, we should start to see that cash position grow and EBITDA being more of a proxy for cash generation because there's only a lease cost in terms of cash cost below the EBITDA line. So that's our expectation going forward into 2026 is our cash generation. Thanks, Frank. That great. And I think all of our positive performance and strong numbers across the business over these these past few years have have really led us to establish a strong position particularly in The US podcast market. So all of this is is coming together. It's positioned AUDIOBOOM is the fifth largest podcast network in The US where the majority of our our focus has has been to this point, you know, in in the most lucrative podcast market in the world.

17:40 And we we keep incredible company, I think, in in that top 10 giant businesses ahead of us wondering is is owned by Amazon and I hope media series, SiriusXM, Spotify, all huge companies, and PR being the BBC of of The US, The New York Times, and then obviously, the large radio group. So very proud of our position in in in in in The US. And, you know, we we haven't had such strong growth and traction in The UK. We haven't focused on that market as much, and that's one of the factors behind the acquisition of APLICIUS that we announced this week. But also, I think key to that acquisition is the recognition that AUDIOBOOM platform business is really well primed to be a consolidator in this space. So, you know, when you look at that top 10 on the left hand side here, one key point is that they only control around 25% of the revenue in The US and in UK in podcasting. So podcasting remains extremely fragmented.

18:49 The other 75% of that that revenue in The US and UK is running through more than a 100 small independent networks and publishers. And one key point to those networks and publishers, the small networks and publishers, is that they do not own or operate their own technology or or platform. They're very reliant on on third party platforming and and technology. And and we've recognized that consolidation these 100 is something that we can leave on and something that will, you know, accelerate our growth in in in the coming years through an m and a strategy. So, you know, we believe that our platform would do a great job of allowing any targets that that we we bring on onto it.

19:39 The ability to really focus on what they do best, which is content creation, content curation, running a network. Our platform will supercharge their distribution, their marketing, their their their monetization of of that content. So, yeah, we believe we can be a leader in the inevitable consolidation of of of of podcasting over the coming years. And, you know, our first target, think a perfect first target, and and and we announced this week the acquisition of of Abolicious. Abolicious are a UK podcasting company. So as I said before, we we had great, you know, great success in The US. I focus less on on on The UK, but, you know, Avalicious combined with our UK audio group team is now positioned really strongly to to lead the market in in The UK. You'll recognize, I think, a lot of on on this slide.

20:39 Avalancheous, you know, has a very similar business model to AUDIOBOOM. It partners with talent, partners with podcasts, and monetizes that that that content for for the podcast. They have great relationships in The UK with talent agents, with management companies. They do a really good job of of working with well known talent and and entertainment podcasts. And, you know, to give you a view on on what they've achieved to this point after launching just four and a half years ago, they they became the fourth largest network in in in The UK, and they have 50 premium podcasts that men wore other podcasts running through that through their their network. They have around 20,000,000 monthly downloads, so that would be added on top of AUDIOBOOM, a 100,000,000 downloads, so, you know, much more advertising inventory and and and content for us to to monetize together.

21:36 5,000,000 unique lists to have a list of podcasts. And in 2025, they're expected to deliver 7,600,000 of revenue. That's a conservative number we feel. And 3,200,000 of that, again, a little bit conservative number, will be recognized by AUDIOBOOM in its 2025 number. So obviously, the transaction completes after the half year. So less than half of half of the year, that was just within the group. And and that's a second set of 3,200,000 of their revenue for 2025 will be will be recognized by AUDIOBOOM. In terms of the rationale, I think, you know, this is a a great deal, and and it's very clear on on why it was the right first acquisition for for AUDIOBOOM.

22:29 So you can see on the left here, you know, as of, you know, three days ago, Abolish is the fourth largest podcast network. AUDIOBOOM, the fifth largest podcast network in The UK market. Putting the two of them together creates the second largest podcast network in The UK with a very kind of clear pathway, I think, to be becoming an ambition to become number one by by twenty third. So I think, you know, when we think about whether to buy or or build, we we could have invested in our UK operation. But I I do believe this acquisition is kind of fast forwarded that that position by around by around five or six years. So, you know, we decided to to to buy here taking market share, building out a strong UK operation.

23:20 And in terms of of, you know, of why I'm doing now through an acquisition, well, I think timing is is very important. So The UK podcast industry has been underinvested in to to this point. Just on a per capita basis, brands and advertisers are investing $1.60 per capita into The UK podcast space. In The US, with that mature of a podcast industry, they are investing around $7. So, you know, we believe there is a there is a big delta here, and we believe that this will start to correct in the coming years. We're seeing the momentum. We're seeing the data around listenership in in The UK, time spent listening in The UK, and and brands beginning to to step in into podcasting. So we believe that this will start to correct by taking that expanded position today through the acquisition of analytics.

24:12 We are really positioning ourselves to capture a greater share of that upside that's gonna come over the next five years.

24:22 So to give you an overview of the the transaction details, I'm sure you've, you know, you've you've read about them over the past couple of days, but we'll break that down into a little more detail. I think that, you know, a a key part to me, and I'll show you a slide on this in a moment, is just what a fantastic deal this this was to be able to acquire our malicious for slightly less than the one times their $20.25 revenue. Wherever the consideration lands through the initial and the and the earn outs, we we were able to acquire them at around one x of their $20.25 revenue, which is much much lower than any of the transactions that are happening in in podcasting, particularly in the The US market. So, you know, we believe this is a great deal of flow for the company and shareholders.

25:12 So the initial consideration that we'll pay is £4,500,000. That will be to the 60% cash, 40% shares. The placing the successful oversubscribed placing was to raise that £2,700,000 in cash. The the 40% that is is going to the sales in in shares was was agreed at the ninety day VWAP as of the May 15 when the letter of intent was signed, which means that those shares will be able to 405,000 shares at a price of £4.44. So we'll be receiving a significant discount to to to to where the share price is is today on that element of the initial consideration, which again really helps this deal be accretive from day one and to prove positive for for for all of us.

26:12 Two elements of deferred consideration up to 3,000,000 earn out based on what they deliver this year in 2025 revenue. So, you know, that that revenue will only land between 4,400,000 and £8,000,000. There'll be a kind of a prorated payment up to 3,000,000 based on on their achievements this year in terms of revenue. And then a further £2,500,000 of deferred consideration payable connected to one key podcast that they that they have. So if that if that delivered that podcast delivers in full, we will be able to see its its full gross margin over the the two year life of that that podcast contract, and a further 2,500,000 will be payable. Those, deferred consideration elements, will be payable next June and then in May 2027, 40% in cash, we which expect to to pay from company cash reserves and and 40% in shares and then a further 20% in our own discretion. So that's the I think the breakdown of the transaction details. All of that said, wherever this lands, including that that the further consideration, we we land at kind of a a one x revenue multiple. These are the columns in the podcasting space over the last five to to to seven years.

27:37 Almost all of them done well above that one x level. The median being 4.4 x. And again, just speaks, I think, to the, you know, to the fantastic deal that we've been able to put together here. We understand and I think that this is first time doing this as a company and you know, if we want to further our accelerated strategy through further m and a, we really do need to execute well on this. And the do it of Avalicious is a very straightforward business model that matches much of of what we do that will make the integration very short, very efficient, create a a very quick pathway, I think, to to to creating the the the the synergies.

28:26 I'll outline some key points, I think, for you today, which will help you understand that. And the first one being Adi Goldsmith, the the CEO of ADLICIUS and his expanded role within AUDIOBOOM. So Adi has joined at least just a few years ago from global media and and The Guardian. He's been really the driving force behind the growth of of ATLASIUS. He'll take on a expanded role within our UK operation and focus on business development, content operations, advertising sales. He will lead that widened team. He'll also join the the AUDIOBOOM management team. So I think he's gonna be a really great addition to to AUDIOBOOM and and AUDIOBOOM's executive team. Other key parts I think to to the integration is our ability to connect showcase our ad marketplace into their inventory very quickly within the first thirty days. That's gonna deliver some immediate, you know, incremental revenue.

29:24 We will consolidate the UK sales team. So the Avalicious sales team and the AUDIOBOOM sales team will will come together. Each of them will bring unique customers to to the table who can then buy advertising inventory across the the opposite roster effectively. So unique advertisers in have a list of who will now be able to access the audio and podcast roster and vice versa. Again, that's gonna be pretty quick incremental revenue there as well for The UK sales consolidation. You know, switching over Teams to to to the London office and then switching over into into audio and technology stack and the audio and platform and switching off the third party software and IT platform and the how this is right on will happen within the first sixty days.

30:16 That's gonna save significant money and also just make this thing more optimized, having full view and intelligence around advertising inventory and and everything Abolish does will will will be a a key part. And then for 2026, as we we talked to you to you all about before, we do a lot of our advertising sales work in the October and

30:40 November of the preceding year. So it's really important to us and and we'll have a real focus on ensuring that all of that avalicious content and advertising inventory is brought into our inventory intelligence platform ahead of that upfront buying system. So, you know, generally, when we go into a new year, we've already booked around 50% of revenue for the year, working with our biggest customers in the upfront season just ensuring that that our delicious inventory is is in our platform. We have, you know, full view on it, intelligence around it will allow us to to sell it well over 2026 and be in a good spot for for for next year as we as we grow together. So, yeah, I think, you know, in in summation, an abolition is perfect company for us to initiate our growth plans with a lot of shared ambition and a lot of shared vision for The UK podcast space.

31:36 On day one, we've created the second largest podcast network. I think it's, you know, a really great deal for for AUDIOBOOM and really does set our our our intentions for the future. So just a couple more slides for us before the q and a. So get any final questions in in for that one. Obviously, as part of the the Abolition acquisition, we've seen the market expectations for 2026 being upgraded, and that comes off the back of some strong historical performance for AUDIOBOOM, some very consistent performance for for for AUDIOBOOM. So, you know, the 2025 revenue market expectation lifts 83,200,000.

32:23 As I said, 3,200,000 of that average revenue for the year will will be recognized by AUDIOBOOM in 2025 as they join the group past that halfway point. And then in 2026, that revenue market expectation will be in 94,500,000. You'll see here the continued strong progress in our in our gross profit. We talked a lot about quality of revenue, and you'll see the upgrades here in in terms of what that looks like for 2025 and then 2026. And same with EBITDA, continue gearing of EBITDA expected. We'll recognize around 400,000 of EBITDA from Adelicious this year in the remaining part of of this year after they've joined the group, and then that 2026 adjusted EBITDA market expectation of of $7,200,000.

33:17 So you can see how this acquisition is is flowing through the company and and helping us build over the coming years. And as I said before, I think to to sum things up,

33:30 this acquisition initiates that that growth strategy as 20,000,000 monthly downloads, 5,000,000 unique listeners to our platform, allows us to take that lead role in consolidating The US and UK podcast markets, lifts those revenue expectations. And and as I said, right at the top here, you know, it's immediately earnings enhancing. So a great deal for audio group, it just sets us up for a good spot for the rest of this year and the future too. Brad, thank you very much indeed for Please continue to submit your questions just in the queue. Session on the right hand corner of the screen. But while Brad and Stuart take a couple of moments Please to review your questions submitted already, I'd just like to remind you, we're recording this presentation along with a copy of the slides will be available via the platform a bit later

34:21 on. Brad, Stuart, you can see we've had a number of questions from investors. So thank you to everybody for your engagement both ahead of today's event and throughout today's presentation. If I may just hand back to you guys and I'll pick up from you at the end. Yeah. Thank you, sir. Obviously, I think that, you know, lots of lots of questions about the transaction. So we'll try and cover as much as I can give you a bit more detail as possible here on there. So, yes, we've said, we believe it's a great deal for the agreement less than the one x revenue with that immediate accretion.

34:55 You know, I think key points being that being able to deliver 40% of the consideration at £4.44 share price is is really great business. But we recognize that there may be some disappointment with the placing price. But, like, it's tough when we we put out a positive q two trading update last week, and then we saw, you you know, an immediate sell off and lowering of the share price. It's just, you know, really is another example of share price and performance not matching up on any. We saw that that drop off, that obviously didn't help with with maintaining that placing price.

35:30 To give you some background, we we ran a a very tight fundraise completed, in under four days, and we ran into a very targeted group of investors. One key goal that we have here alongside raising the the money, obviously, was to bolster the level of long term institutional holdings, which which we've done to help them move that volatility that we we've just haven't had a history of because of the heavy retail shareholders. So so you can recognize the frustration on on the price, but this is this was done with with that intention of institutionalizing the the the shareholder register. We've done a great job of that, you know, targeted, very tight fund fundraise here.

36:15 Directors did not participate in in in the placing and that was to help institutionalize the the the register.

36:24 And now, you know, I can, you know, find a point perhaps on this one is that we we did assess whether or not to to do a retail offering, but really due to that price falling after those positive future results and then the the tight discount to that price, you know, we just felt that we couldn't take any further dilution here. You know,

36:47 I think we've made the right decision there and I think the market really does look like they understand the positives of this transaction and it's being supported. I've got one more Brad and then I'll throw it to you perhaps. The other question that we've seen a few times here is just on share buybacks. I think this came in following our AGM notice where we included a standard resolution. We do that every year. We include a standard resolution each year in in the AGM notice, which will give us the authority to buy back shares if we want to. In terms of how we use cash, as Brad spoke to earlier, cash will be pretty static across twenty twenty twenty five.

37:33 And then in 2026, EBITDA becomes a proxy for cash once again. So we start building cash within the business. As we talked about earlier, we we believe we're a great platform for m and a. So so use of that cash as it grows next year will just be need to be considered alongside those M and A goals as well. So that you know that share buyback authority is a standard resolution we have in there every single year. Just as a reminder the AGM will be on July 30. Thanks. There's a question from Paul team during the session about the EBITDA weighting. And as we went through earlier, the revenues weighted to the second half of the year and the EBITDA is as well. So last year during the second half of the year, the company generated $3,100,000 of EBITDA.

38:26 So we need to mark an expectation this year. The company needs to do the same, generate about 3.1 to go from 1.8 up to up to 4.9. So, yeah, there is that seasonality there in in the EBITDA as well. Further question on scene is why just to clarify on on the cash position within within the company. The owner's contract I mentioned earlier on, the company provided for that in 2023, $7,500,000 of provision. That has been unwinding on the balance sheet since that point. And as of the end of June, that is now $1,500,000. So that impact, during 2024 and 2025 hasn't been impacting the p and l. So that's not a a cost reduction.

39:11 That's simply a provision that's unwinding its balance sheet. That's simply the cash that's being paid for that contract. That's why, just to clarify, when you say that the the cash would increase next year during 2026, that's effective. They can be, you know, a big part of that is the company not having to not having to pay that over its contract. So just to clarify that in terms of the cost and the cash within the company. If you have a quick question here from Martin about YouTube.

39:59 Nothing asking about whether there's developments on YouTube opening up to allow automated advertising. Nothing, I think, nothing more than we we spoke about perhaps last time, but we believe the intention is is there to allow us to advertise in the future through through YouTube right now. Our premium advertising can run through YouTube, but showcase cannot run through through through YouTube. So we do a really great job on monetizing video content and video podcasting with with our premium monetization. And and as much as kind of insight here, YouTube have have stated that they will start to allow pass through of pop up distribution and, you know, and and potentially automated advertising as as well. So we will we'll keep an eye on that and video is definitely an area that we are focused on in the future.

40:59 Yeah. Another one, cost of integration, non material. No. We we don't view them as as as material. Yeah. Our process is is underway. We don't view any significant costs associated with that. You know, we need to get the Stuart said, the inventory on onto our platform, but there's experts within, you know, both companies and for the AUDIOBOOM side and technology that we use. You know, the team have been through that process on an AUDIOBOOM stand alone basis. So no, you know, no material costs expected. You review the company as we get to know further over over the coming weeks and months. But we're doing that as quite a quite a straightforward process as as Stuart said early on. Hello. I'm here from Martin. How do you see The US ad market in H2 given macro uncertainty?

41:47 I it's a great question obviously. I think it's a question you get asked a lot. I think it's very stable right now. You know, there was certainly some uncertainty around Trump's tariff announcements back in in April. We didn't see any big knee jerk reactions from advertisers pulling budgets or or or canceling camp campaigns, but certainly some nervousness, I think, around, you know, around what was what could potentially happen. I think that's drifted. I I think that there's a, you know, a kind of a confidence level in the the the advertising podcast advertising space anyway. I mean, obviously, was some negative w two WPP announcements last week.

42:34 But you have to remember that, you know, the majority of of what they do is on legacy media, you know, publishing, TV, and podcasting is new media and exciting space that advertisers want to be in. So no, I think I would describe the current position as being very stable. And then final one on Adelicious margins. Will we expect any improvement on those? Well, Adelicious gross margin runs just above 20%, you know, between 2022%. So in terms of the in terms of mix that we have, we don't expect to see any jump up in in margin. But, obviously, across the group, we've seen that margin profile increase because of the increased contribution in showcase.

43:20 So that we're gonna see improve you know, slight improvement on that over over the coming months and and years. But I was just compliments what we what we do within AUDIOBOOM currently. So no major changes in in margin profile as we as we go forward. I'm obviously striving to to achieve that general trend that we've we've recognized over over the last eighteen months. Thanks, Brad. I think we right at the end. It's eleven fifteen. So, yeah, thank you all of you for joining. Thank you for your questions, and and, you know, we really do believe in this transaction. Hope you can understand the logic behind it and the positives that it's going to bring. That's great. Brad, Stuart, thank you once again for updating investors this morning. If I please ask investors not to close the sessions, we'll now automatically redirect you for the opportunity to provide your feedback in order the company can better understand your views and expectations.

44:17 May take a few moments to complete, but I'm sure it'll be greatly valued by the company. On behalf of the management team of AUDIOBOOM, we'd like to thank you for attending today's presentation, and wish you a good rest of your day.