Eenergy Group (LSE:EAAS) — Investor Presentation

0:00 Good morning, and welcome to the EENERGY GROUP PLC Investor Presentation. Throughout this quarter presentation, investors will be in listen only mode. Questions are encouraged and will be submitted at any time by the Q and A tab situated in the right hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question received during the meeting itself. However, the company can review all the questions submitted today and publish responses where it's appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to Harvey Sinclair, CEO. Good morning to you, sir. Yeah. Good morning,

0:31 and welcome, investors, this morning. This this is an opportunity for Chris and I to update you on what's been a very busy and productive six months after having, obviously, some quite some some significant changes to the business. So this really is a slightly different format than usual because we want to talk to you about a lot of the things we're putting in place for the business that reflects strong outlook going forward. So whilst the last six months have been challenging, I think there are a number of very, very strong positive underlying key points that we want to get across this morning to investors. But before I do that, I think I wanna just put some context to the backdrop.

1:18 So from a trading perspective, we've had a a slower than expected h one trading performance. And there's a few reasons for this. As you know, the the energy prices in 2022 set the scene for a strong acceleration of energy transition projects. And then in the last twelve months, there has been a a slight change in momentum in the market. That said, the future trajectory is extremely strong and extremely buoyant. But the last twelve months have had a few macro trends, which have caused some difficulties for our market, one of which is obviously being the the the stabilization and then falling off of energy prices from last summer. And the second is the rise in interest rates. And both created a bit of a perfect storm that scuppered the momentum, the strong momentum that the energy transition sector was seeing for key decisions being being made by our clients around big energy transition projects.

2:21 And I think that's something we've seen ease off, and we'll talk a little bit about the government changes and the the public sector drivers that are now back in full swing. But those two levers did create a pausing of the strong momentum we saw. And I think when you combine that with some of the internal transition changes that we were going through and the disruption of disposing what was over 50% of our business from an integrated company perspective and then the post rebuilding of our energy services business, it's not surprising that we may have seen some knock on effects to the current trading. And we did take this as an opportunity to pause and reset.

3:09 So in q two, there was an opportunity to have delivered more revenue, but we chose deliberately to push some of our revenue forward while we were using some of the, if you like, post transition exit window of opportunity for us to to to invest in our infrastructure. And what we are now is we're in a a very, very strong position where we've taken some big steps to build out the energy infrastructure for around the services business. And having restructured following the sale of energy management, we've got a stronger internal platform from which to build, in particular, the solar business, as which you'll see has grown significantly over the last twelve months. We've invested a lot in people to complement the technology, and we've built what we believe is a very scalable platform that's going to be able to support that step change from what will have what we will have seen is over a 500%, organic growth in in solar.

4:12 We've now clearly got a much stronger balance sheet. We've been able to use our balance sheet to renegotiate our supply chain, and we've seen some very, very strong changes to our benefit. And you'll see that our margins are trending upwards as we talk through the business later in this presentation. And together with our strong balance sheet, we've been able to start facilitating the NatWest funding product that we have, and we've already now successfully concluded a number of drawdowns from that NatWest facility. In the last six months, despite the fact that revenue itself, which as you know, reflects the installs delivered, our actual pipeline has grown stronger in the last six months than any previous period. So we are sitting at a point now in August where we have got strong contracted revenues, and we are maintaining our guidance for the year despite what looks like a slower than expected h one. So I think from an investor perspective, I think I want to provide the reassurance that the underlying drivers of our business haven't changed, that we've got an extremely strong opportunity as we look forward for the year.

5:34 But we've taken this opportunity to build it on a really strong platform, and and I'll talk you through some of those changes in a second. So for those investors or, I guess, for those on on the call today that haven't had, I guess, a refresh of our our proposition, having now exited the energy management product offering, we've now finessed our, I guess, proposition to customers into three very, very clear categories from which we wrap a unique proposition around. So we've always been very focused on energy reduction and the the ability for us to transition our customers with capital free solutions through the use of energy as a service focused on lighting controls.

6:24 That is a, very, very strong centerpiece of our strategy, helping our customers deliver energy reduction strategies through as a service. And this division, is very much focused on public sector, very much driving a leadership position in the education market, delivering strong margins, 38% and rising. And we believe that this market, as you'll see shortly, is still extremely addressable and a very strong opportunity for the business. Complementing that is our fastest growing part of our business, which is the generation vertical. And this is a very clear proposition to customers about delivering turnkey solar PV solutions across ground mount, rooftop, and carport solutions, where we focus on quality and service, and we're looking to deliver risk managed solutions for customers in that mid market 250 to 5,000,000 pan sort of, if you like, enterprise solutions delivered as a service or as turnkey solutions for those that do have investment for their infrastructure upgrades.

7:34 But generally speaking, combining reduction in generation as a wrap solution for our customers, largely in the public sector, which is our focus, but increasingly with solar moving into some really very exciting commercial, industrial, if you like, projects that we are starting to build our pipeline around. And then finally, our charging solution remains an important strategic offer opportunity for customers, but we still don't see the growth in charging that we see in reduction generation. That's not to say that we don't see it coming. It's something where we're using as an add on to our customer proposition at the moment, Our customers typically want a handful of charges to deal with an initial uptake of their customers or their stakeholders coming to their buildings with EV vehicles.

8:30 And I think that's an opportunity for us to grow in the future. But wrapping all of our service propositions is s in essence, two things. One is the ability to have an off balance sheet, simple financing solution, which we're using the NatWest for the public sector and our other panel of funders for commercial the industrial projects. And then a data insight solution, which sees us still using the myZero license that we've kept post transaction that allows us to provide verification, measurement, monitoring, and carbon reporting to our customers. So differentiated from our competitors and a very strong compelling proposition. And I'll talk about the addressable market in in in a while. So when we think about the market opportunity, there are a lot of key long term drivers.

9:19 We've got a new government that is clearly going to prioritize getting to net zero faster and with more vigor than the previous government. That's been a publicly stated strategy, and we're already seeing the momentum in areas such as the reduction of red tape and the the ability for our education partners to sign more flexible financing agreements that don't have necessarily some of the red tape that they were saying twelve to eighteen months ago. So a very strong, favorable, regulatory, and policy driven environment is going to be fantastic for the public sector. The public sector is probably the sector which is gonna be influenced more to get to net zero than any other vertical in in our market. And so for us, that's a very strong strong inflection point. And after, frankly, a twelve month softening of people's focus on net zero, we said they see there being a very strong race now to net zero in 2030 as people start to get back focused, having solved some of their own economic internal issues around their own business challenges to getting to net zero. So anything we can do to help our customers get there faster and more efficiently with more value is is is is really good.

10:45 Solar, clearly, the the hottest energy transition topic in the market at the moment, and we believe we've put ourselves in a very strong position. The energy market is still volatile, volatility for us is a good thing because it provides uncertainty. And when you're talking to customers about driving on on-site generation, what what you're really talking about is security of supply of energy for that customer for a percentage of their consumption profile. So, typically, we see our customers removing the reliance of the grid by about 30%. So a typical hospital or secondary school, for example, or or large public sector building would would typically see a third of their energy consumption come off their profile by going off grid through an on-site generation scheme, and that effectively takes a third of their volatility away because they've got a twelve ten year index links clear view of their energy profile going forward.

11:51 In a capital constrained market and where budgets are tight and where subsidies can only go so far, what our capital free solutions allow our customers to do is to do more than one energy transition measure. So despite the fact we see the government focused on grants and subsidies, which we can take advantage of, the customers that we see have always got more than one energy transition driver with that Solar versus an energy reduction strategy, our solution means that they can do two at the same time. Customers are also very much more focused around one partner for one turnkey solution rather than multiple partners and multiple execution challenges. And increasingly, the demand for energy insights is more and more important as people start reporting on their their carbon footprint and the changes they're delivering to that carbon footprint. So they're the long term drivers. And then in terms of the market opportunity, we took the opportunity since January to deploy a number of independent research pieces of work to ascertain what the addressable remaining addressable market was in education and health care because we didn't really feel there was clear, concise advice out there or concise data that we could really rely on.

13:14 So we commissioned our own internal report, and we also worked with a partner who commissioned a strong report that gave us the reassurance that in the education market, we're still looking at 65% addressable for lighting alone, which values our market opportunity in education at over 2,000,000,000. And we think that market has got a decade still to run. Clearly, there's going to be a big chunk of that transition between now and 2030. But the research shows us that the the long tail is a decade's worth of transition. Regarding the health care market, whilst there has been some some key project transitions in this space, we're still still talking about a 50% addressable market. So we've got a multibillion hand opportunity for EENERGY in a

14:04 favorable government and regulatory of a market where there is a huge driver to get to net zero by 2030 and where we got a very, very strong brand, it's differentiated to the public sector in particular with credibility and with the ability now to scale, having invested quite heavily in a lot of infrastructure, systems, and processes. The other the other key area that we've been investing in as part of the market opportunity and is in in relation to the way in which some of our competitors have grown, which has been a a different route to market that EENERGY has followed is the fact that we've always had a direct sales solution. We've always had a very, very successful platform for scaling, strong conversion rates, strong incoming opportunities, and an operating model that's all driven around direct sales.

14:58 We've now spent the last six months building out a platform which is framework ready and where we have now onboarded ourselves with a dozen plus very key frameworks across different segments of the public sector and a team behind that, which is able and ready to respond to frameworks. And when we look at our our competitors in the market, we see that 80 to 90% of their growth has come from framework driven opportunities. Whereas at the energy for the last four years, over 95% of our growth has come from direct sales. We believe this could be a strong internal inflection point where we're able to combine the best of both worlds with a strong new team and frameworks and the ability to start bidding on seven and eight figure, projects and also maintain the direct sales, strategy that we've been having, to date with great success.

16:03 To give you some highlights, and just to recap on a number of quite specific things we've been doing, which we're very proud of, the business itself, was integrated with energy management. Okay? And so when we talk about integration, we're talking about finance, operating models. We talk about CRM systems. We talk about, you know, the project management modules. We had to dis disentangle that in order to be able to exit the energy management business.

16:32 And as part of that process, keep that as least disruptive as possible, we allowed that business to go with a number of versions of platforms. And the the opportunity, therefore, arose for us to rebuild an integrated finance ERP system under NetSuite, which Chris can talk about. That's been a really big significant investment and allows us now to have a lot more robust a lot a lot lot bigger and a lot stronger robust handle on our finances and our balance sheet. We rebuilt our operating CRM system. We've created a new end to end Salesforce and project management, workflow stream for customers that integrates with our ERP system, and that will stand us in great stead as we look to grow over the coming years as we look to grow to grow and expand the business.

17:23 We have and continue to invest quite a lot in our proprietary app, and this is a really important point for investors to recognize.

17:33 We see our business as having two parts to it. We're a developer on one hand, and we're an EPC provider, which is effectively a sophisticated contractor, which is the EPC stand for engineering, procurement, and construction. So when I think about our business in two parts, we need a fix on the game in both parts. So for, the development model, what stands us out as being better and more value add than our competitors? One is our route to market. One is our brand. One is our track record. The other is our operating model internally about how quickly and how efficiently can we take an interested opportunity and qualified opportunity through to an investment grade proposal. In order to do that, we've automated and systemized and created technology that allows us to collect data on sites more quickly and more accurately and to use AI and technology to automate that data into a specification and therefore investment grade proposal where we can convert 80 to 90% of all our opportunities automatically to a proposal in days versus weeks.

18:42 And we know that our conversion rates are much, much stronger when we can get a customer an investment grade proposal from when the clock starts ticking on a qualified opportunity. And so that investment in the app is super important for us. And as we start to expand that from the reduction division through to the renewables offer, we also start to think about things like the project management, procurement, and financing modules all being part and parcel of that app so that we can scale both regionally and into other product sets. Touching again on the frameworks, we've invested in a platform that allows us to to access every single framework, bid and tender automatically as it comes through, the marketplace.

19:28 We've got a system in there to sift and select. And just to reflect on the solar, division, that business will have grown 500% from a revenue perspective year on year on a like for like basis. Now in order to ensure that both that opportunity is sustainable and that we can deliver a high quality scalable solution for our customers, we've clearly had to upscale our our resource internally from a management perspective, but also from a technical capability perspective. So the team that originated at the sort of proposition eighteen months ago was part and parcel of our energy services team. They're still very much a key part of our solar structure, but we've hired some seriously skilled and experienced talent into our business that have been building solar renewables businesses for the last decade plus for some of our competitors and some of our, you know, other competitor type businesses.

20:30 So we've now got an upgraded and strong team, but we've also been able to upscale a lot of the supply chain and for engineering procurement capabilities of that team to enable it to grow. Chris will talk to you a little bit about the the group restructure, but also around the balance sheet. As you know from announcement last week, we've taken this opportunity to clean up our balance sheet, and that's going to allow us to have a much cleaner financial reporting and also, you know, governing strength behind the way which we report going forward. NatWest is fully embedded. We're excited about the facility. We are starting to see real strong traction.

21:17 We've had two drawdowns now, and we're expecting to start really getting some momentum behind that now as we start to expand that across all of our product sets and across both education and health care. So we're delivering,

21:30 a really, really strong pipeline now, that, as you know, have a six month to twelve month gestation period. So the work that we've invested in for h one will start to yield really strong results in h two and for next year's h one. So we're entering h two with extremely strong momentum, strong conversion rates, which are up year on year, and a really robust forward order book. And when I look at the h two revenue forecast, we can see that the the and we'll go through it in a second, but the the the workflow and the revenue that we've got locked in more than covers q three expectations for the best q three we've ever had. So we're extremely excited about h two, and we're gonna start seeing cash generation come forward.

22:21 In terms of the sort of trading summary, I think I'll hand over to Chris, and he can talk you through some of the numbers, and then I'll I'll to him about some of the other developments. Thanks, Harvey. And so as Harvey has outlined, h one results were challenging. These were impacted by the constrained balance sheet prior to the completion of the sale of Energy Management during q one and also challenging market conditions as a result of a reduction in energy prices and at the same time as an increase in the cost of finance. The core revenue for the Energy Services business of $6,200,000 was therefore down from $11,000,000 on a like for like basis in the previous year, and with an adjusted EBITDA loss of 2,100,000 for the group, down from a profit of $05,000,000 on a like for like basis last time.

23:10 The operating cash flow for the period reflects this with strong cash generation expected in h two, mirroring the forecast earnings profile for the year. As Harvey mentioned also, following the disposal of energy management, we have taken the opportunity to conduct a full review of the group's balance sheet structure. Following this review, we are expecting to take an exceptional charge of up to 2,500,000 at the half year, and further detail of this will be provided in the interim accounts. We've been pleased to see a strengthening in the market during the period and the political certainty given to decision makers following the UK elections has further supported this. That all bit gives the business strong momentum coming into h two, and we're maintaining full year revenue guidance.

24:02 Thanks, Justin. So I was just gonna talk to this side as well. I'll you there on on the outlook. So the h two forecast is underpinned by a robust contracted forward order book coming into the period, which covers 44% of forecast h two LED revenue, which was contracted as of the date of the trading update. And that's consistent with our target to maintain at least a three month contracted forward order book in LED. 75% of our forecast h two sale solar revenues were also contracted. And as you'd expect, those contracted revenues have further increased in the last few weeks since the trading update. We have good coverage on the new business requirement for h two following record pipeline growth in h one, as Harvey mentioned. And I'm also pleased to say that management actions during h one are delivering improving margins for both LED and solar, and we expect this trend to continue through h two and beyond.

24:58 So whilst the h two revenue forecast does represent a step up from h one, the robust forward order book and strong pipeline allows the board to maintain the full year revenue guidance of 25,000,000 to 26,000,000. Thanks, Holly. Thanks, Justine. So just to recap on a few interesting points around the business. I mean, from my perspective, I think we've got the best team we've ever had. I think morale is at its all time high. I think we've got a really exciting strategy in a really exciting market. This race to 2030 is gonna set ourselves in for an explosive market opportunity for the next six years. I've got absolutely no doubt in my mind that this brand is well positioned to really scale within this market opportunity, and I think there's going to be some really, really big and exciting projects that EENERGY will, set itself up to win over the coming six months.

25:58 The the pipeline growth of over the last, few months is is is proven to me that the the sluggish nature of the last twelve months is behind us in terms of that ESG fatigue we were starting to see post energy crisis. That's definitely been shaken off in the market, and our supply chain partners starting to feel the same thing in market generally. For us, being public sector focused is a really super exciting place to be. I think the new government has got an accelerated and more invigorated strategy, and I think they're here to set themselves up as being an ESG net zero climate action orientated government, and I think that's just phenomenal thing for us.

26:45 The the opportunity to pivot from our education background,

26:51 has been, clearly a big opportunity for us over the last few months, and that pivot to health care with having won, you know, a phenomenal contract with Spire earlier in the year, which is going well instantly, allows us to really set ourselves up as the number one public sector energy services provider in The UK. And, really, that's my goal, which is to build market leading brand, differentiate it through technology, focus and centered around quality and service. So I always say, you know, you you you can choose price, quality, or service, and you can choose two out of three. We we do not sell on price. We do not we do not set ourselves up to try and be the cheapest or the most value orientated from a from a pricing perspective. We set ourselves up as being value orientated around long term value across the

27:44 length of the contract, and we we pride ourselves on quality and service. So very health and safety focused, which I think is the most important thing for solar businesses. And the team that we built reflects the highest possible quality that we found in the market. Leveraging finance for us is at the center point part of our business. The NatWest facility was difficult, expensive, and complicated to put in place. We see that as a massive barrier to entry. It took longer to put in place and longer to implement than we would have liked partly because we had so much going on in the business. But now it's in place and the system is well oiled for growth. Think there's nothing stopping us from really leveraging that that platform.

28:29 And then in terms of our investment, I've talked about the platform, the systems, technologies. In order for a developer to become scalable, there's got to be a technology. There's got to be a platform based focus and mindset, and that's what we now have. So just to reiterate, I'm I'm I'm the most confident I've been around the the future trajectory of this business, and it's been great to have the opportunity and, I guess, taking opportunity over the over the last few months to stabilize and put ourselves up for success going forward.

29:06 Perfect. Harvey, Kristen, thank you very much for your presentation. Ladies and gentlemen, please do continue to submit your questions just by using the Q and A tab, which is situated on the top right hand corner of your screen. But just while the company take a few moments to see the questions that have been submitted today, I'd like to remind you that recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard. As you can see, we have received a number of questions throughout today's presentation. And Katie, at this point, if I could just hand over to you to share the q and a, that'd be great. Then I'll pick up to you at the end. Thank you very much. Thanks, Harvey, Kristen, for the presentation. We've had several questions come in, already. So you touched on it during the presentation, but what impact are you expecting or have you already seen from the new government? Yeah. Great question. So as I did touch on it, I think there's two key points here. One is the the reduction of bureaucracy around governing governance of paperwork and governance of accounting rules.

30:03 I think there's been a relaxation for the education sector, in particular, around what what format our customers can sign on long term long term kind of financing arrangements. That's gonna be really beneficial to us as customers feel less nervous around signing up to certain types of agreements. And the other is more demand from the government to the public sector to take net zero more seriously and to put it on top of their agenda. So if there was any form of hesitance or deprioritization, that's now being firmly reprioritized. So we're seeing a reprioritization net zero, increasingly grant focused market, but that can only go so far, and a more lenient, I guess, environment for them to provide private commercial companies the opportunity to support the government's drive to net zero.

31:04 Thank you, Harvey. And another question that's come in is what's the opportunity kind of around battery storage? Great question. So mid to long term, this will be the the biggest value driver for the energy sector that we've ever seen. So as as solar becomes more deployed and our built environment starts to reduce its energy wastage and starts to populate the the ability to generate on-site, it's all gonna be around how do companies get off grid and how do companies store their solar energy and trade it at a discount to the market on grid. So our focus has always been a land grab of customers. We've got over a thousand customers, and we're looking to acquire somewhere between two hundred and fifty and three hundred and fifty customers a year.

31:57 Over the next three years, the the cost of the battery will reduce by 50%. We're seeing evidence from the Far East that on average, we're seeing a 15% reduction on year on year battery costs. The analysis we've done shows us that in order for a battery solution to be economically viable, financeable, and to provide the same kind of valued metrics financially to a customer and to a funder, battery cost has to reduce by 50%. The moment that happens, the whole concept of micro grid, which is creating traded electricity power in between communities and having each site being able to be more more more self sustainable happens in in the blink of an eyelid.

32:48 So for us, being able to build a custom base that we can layer in a funded battery solution for customers that have got solar, whether it's our solar or someone else's solar, it's gonna be a phenomenal opportunity and and a massive massive market value driver and will give us another decade's worth of growth. Thank you. And on the the solar aspect of that, is there someone just asked about kind of what the barriers to entry off of solar in your target market? So I see the solar market into three parts. You have utility scale investment grade. Let's let's call it grid scale solar solutions, are, you know, 10 meg or more. That market is something we don't focus on. And then you have the SME market, which is 10 kilowatts to 50 kilowatt schemes. So think SME, 10 to £50,000 in solutions.

33:43 This this part of the market, we also do not focus in on for three reasons. Firstly, that market is low barrier to entry. Anyone who has a customer base that provides any form of mechanical electrical services, electricians, scaffolding companies are all all kind of flooding that market with low cost solutions, very, very low low quality, low service, raised to the bottom on price. We're staying well away from that market. Our market is the mid market, in particular, sort of 250,000 up to £5,000,000 projects. These projects have complex supply chain needs, which have high barriers to entry for small companies because of the nature of the length of investment you need to invest up front, the nature of the supply chain, and the revenue profile and cash profile of these projects.

34:44 You know, to to run a strong solar business model, you have to have a strong balance sheet, which is the very reason why we're so excited about the post transaction from energy management and what we've got in front of us. The second area is these large schemes are all around risk management. We've got a lot of operational risk for these customers if something goes wrong on roofs. And and I think there is a reluctance for customers, commercial, industrial, or public sector to take the risk on companies that have not got a track record of running large scale, you know, mid market associations. So from our perspective, the bad entry is massive in our target market, partly because of the purity of the market, the financial constraints, the cash flow profile, and also the credibility of having proven they've done it before. We also see that this market is quite thinly served from a competitive perspective, and we don't really see we've got much more than a dozen or so credible competitors in our mid market public sector vertical.

35:57 Thanks, Harvey. And, actually, following on from that, someone's asked, do you have any plans to expand your operations beyond The UK, particularly in the markets where renewable energy and energy efficiency are gaining traction? Yeah. We do. But it's all about timing. We we talk a lot about our growth aspirations, and I think this is a year for stability reinvestment and pivoting for growth. You know, we're going to have seen strong growth this year by the time we finished the year end of December. We'll have delivered a huge growth in solar. If we can deliver that and set ourselves up for another strong year in The UK and Ireland for next year, I think there is an opportunity to go beyond that into some very exciting target markets that that we can explore in the coming months. But for now, next twelve months, very much UK focused, you know, strategies I've set out, but, yeah, aspirations to go further in the years to come.

37:03 Thanks, Harvey. So I was just wondering if you could possibly provide a bit more detail and context around the Spire contract, if it's all kind of margins, expected profitability, and whether there are any similar large scale opportunities in the pipeline. Sure. Look. The the Spire contract is very complex. It's a 43 it's a 43 property rollout across the whole of The UK. Margins are on plan as our per our original budgeting. We are halfway through the contract. We expect to complete it in the next two to three months. We got a good relationship with our customer. We've invested heavily in the contract with some key people, and I think that we're very focused on delivering that customer an extremely high quality service.

37:59 In terms of other large scale projects, we have got a number that we're looking at of 7 figure projects plus. We're starting to very much focus in on tender opportunities in that 1 to £5,000,000 contract value bucket. And as you can appreciate, they're they're pretty big needle movers. You know? If if if we're working at, you know, 25% margin for solar project, let's say, the the that's sort of the midpoint, you know, on a £5,000,000 project, That's quite a big needle mover for the financial outcome without investing any further resource into the business. So, yes, I'm very much focused on last 7 figure deals now. Thanks, Harvey. Following the sale of the energy man management division and the repayment of the debt, someone's asked how the company is prioritizing these capital.

38:52 Are there any plans for further debt reduction, share buybacks, or any kind of specific investments in growth areas at all? So, I mean, just for my part, I think the key is around ensuring that we have a healthy balance sheet, but at the same time, push our creditors hard to make sure that we optimize our cash flow cash flow profile. So we are looking at procurement strategy for our creditors that allow us to leverage our balance sheet so we don't have to use it unnecessarily. I think we've clearly we we clearly removed the debt in our business, which is a a strong thing. We haven't, at the moment, got a strategy to invest in our own projects.

39:41 We are looking at ways in which we can leverage the network's facility, and that's being part and parcel of the way in which we used our our balance sheet. Chris, Ben, do wanna add to that? No. I think that's exactly right. And and I think we spoke about that, the opportunity to to leverage the balance sheet strength to improve margins, and I think the NatWest facility is a good example of that. But but, yeah, it's it's helping us drive growth in in the energy in in that energy services division. Thanks, both. Again, this was touched on in the presentation, but just a question about how strong is cash flow now and the specific impact for the 2.5 balance adjustment?

40:30 Yeah. So should I take that on, Harvey? Sure. So so, yeah, as we as we as we highlighted in the presentation, we're, you know, the the cash flow profile for the year broadly mirrors the earnings profile for the year. So we're forecasting strong cash generation for h two. And the full break breakdown of the balance sheet as at the as at the period end of the end of June will be provided in the interim accounts. That that's also the case for the 2,500,000 adjustment we've talked to. That is that that's a noncash adjustment. That's sort of legacy balance sheet adjustment. Thanks, Chris Ben. And just a final question, unless any other questions come in during the answering of this. But it's just about the type of period. Over what type of period do you expect the NatWest facility to be utilized over?

41:25 And is there any forward looking as to what happens post the facility? So I think based on based on our sort of three year plan for deploying third party capitals on interprojects as across solar and our energy reduction division, I think, you know, this is reasonable to think that the facility is probably a two to two to two to two to two and a half year deployment cycle. I think the the partnership in NatWest is going from strength to strength, and I think that there is an appetite for delivering growth beyond this. And I think, in fact, if we can accelerate the drawdown of this facility with the profile of customers we've got, it's a long term partnership we want to explore. And this is not a one this is not a one facility partnership. We want to be doing much more with NatWest more broadly and more quickly. So I think I think, yes, watch this space.

42:30 Great. Thank you very much, Harvey and Chris. And that's all the questions. Perfect. Harvey, Chris, and Katie. So thank you for answering all those questions. You can for investors. Of course, the company can review the questions today and we'll publish certain reports on the investor meeting company platform. But just before redirecting investors provide you their feedback, it's particularly important to the company. Harvey, can I just ask you for a few closing comments? Sure. So good to have the opportunity to update investors today. It's been a it's been a really busy six months. We think we're in a fantastic position now with a with a a really strong team, great pipeline, great regulatory environment. The sprint to 2030 has got everyone very excited in our business, and we've got an incredibly strong outlook for h two. So I'm looking forward to updating investors in a couple of months at the end of sort of the interim period where we can, you know, lock in that that commitment of our revenue for h two and start looking for increased cash generation going forward as well. So, yeah, very excited about the future.

43:32 Harvey Crispin, thank you once again for updating us today. Could I please ask investors not to close the session as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations? This might take a few moments to complete, but I'm sure you'll be greatly valued by the company. On behalf of the management team of the EENERGY GROUP PLC, we'd like to thank you for attending today's presentation, and good morning to you all.