Emv Capital (LSE:EMVC) — Interim Results Investor Presentation

0:00 Good morning and welcome to the EMV CAPITAL PLC Interim Results Investor Presentation. Throughout the quarter presentation, will be in listen only mode. Questions are encouraged and they can be submitted at any time by the Q and A tab situated in the right hand corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question received in the meeting itself, but 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.

0:28 And I'd now like to hand you over to Ilian Iliyev, CEO. Good morning, sir. Thank you very much, and welcome to this webinar by EMV CAPITAL PLC. For those of you who have been following us, you know that we've had a recent brand change. We used to be called NetScientific PLC. So this is now the new colors and the new name, and I'll talk you through the logic of that shortly. Joining me today is my colleague, Ed Hooper, general counsel of EMV CAPITAL PLC as well as executive director. I will take the presentation, and then we'll do q and a jointly. So this is, of course, the presentation for the results of the first half of two thousand and twenty twenty four.

1:14 And through the presentation, I'll take you I'll remind you again what is our business model, who we are, what is it that we do, our team, and our business operating model, financial and operational highlights, some portfolio help highlights, and outlook and strategy update for the business going forward, and then, of course, summary and q and a. Please, as as always, submit your questions, and we'll try to answer as many as we can at the end. So EMV CAPITAL PLC is a deep tech and life sciences venture capital investment group. Our model quite simply is to identify, invest, and build high growth companies in The UK and internationally. We tend to focus in particular on companies that are that might be UK based, but they have a highly internationalized focus and are very ambitious and want to grow internationally.

2:04 We, as EMV, have a strong vision to become a leading venture capital investor in the deep tech and life sciences sectors both in The UK and internationally. We, this year, we reached a major milestone in, breaking through the 100,000,000 assets under management, mark, and that includes importantly £41,000,000 in direct balance sheet holdings. I'll just repeat that. Out of the 100,000,000 in AUM, 41,000,000 are on our balance sheet, things that we own directly, the balance is managing funds of other investors. We now have 70 plus portfolio companies in The UK and internationally. For those of you who've been following us for for a few years will know that this is a significant growth, but that's not the end. We are building a sustainable platform, and our next milestone is AUM of 200,000,000 plus.

2:55 A bit a little bit on our operating model. And as I go through the portfolio later, I'll I'll try to bring out these different elements for you. We are not classic fund. We're not a classic VC fund. We have a multi multilayered model which we believe enables us to do interesting things in the VC space that others can't. First of all, we have a capital efficient investment strategy whereby, to the extent we use a little bit of balance sheet, we leverage that by using third party investments in the portfolio. That is to say we bring other investors sitting behind the custodian, and we grow our assets under management that way. And sometimes PLC will take a little bit of a balance sheet position. We have a very proactive portfolio management approach that enables us to be close to management of the businesses to identify value opportunities, identify when is the best time to invest, and, of course, protect our, our positions in those businesses.

3:53 In addition to that, in some ways similar to private equity, we have what we call a value creation services, site whereby for a small subset of portfolio companies, we pro we provide a serve various services ranging from a a outsourced CFO to to helping them with the corporate negotiations, through, business strategy development and connecting them with our panel of suppliers. But we do all of that to accelerate their growth and help them work through difficult moments. We charge for that service. The fee generation aspect of our model is really key. What we identified at the time when Net Scientific acquired EMV CAPITAL, the business I founded many years ago, was that doing all of this purely from balance sheet is very, very difficult, not only in The UK equity markets, but elsewhere.

4:43 And that is why we have built this fee generation platform that combines different sources of transactional, ongoing, and recurring fees, and that is what, eventually pays for the infrastructure for being able to engage with these companies, and you get the carried interest and balance sheet investment as an upside. We now have a route to breakeven on the back of our fee generation work, and that is immensely helped by the fund management practice, which we launched earlier this year. The fund management practice comes on top of the syndication, the investment practice. It provides us with scale, additional opportunities opportunities, additional recurring fees as a fund manager, and importantly, carried interest over the funds that we manage for third parties. Around all of that, ultimately, what matters is the exits of these businesses.

5:34 It is, as you know, notoriously difficult and tricky to get exits in the venture capital space. So we have a combination of a proactive drive working with a selected few portfolio companies to work them through their, road map to the point of a so that they're ready for an exit, but also understanding through the portfolio where we're a little bit more passive when is the exit likely to come, what can we do, what does that mean for our positioning in terms of investment. Last but not least, we have a strategy for deepening our direct stakes from POC level in companies that we really like, where the time is right, the price is right, and sometimes we do this by running services in for equity. That enables us a PLC level to keep developing direct stake in the businesses that we like, and it supercharges our potential returns in the future.

6:23 K. Now in terms of our team, we have what an intimate but well working board. I'm the CEO of the business. I'm also the founder of EMV CAPITAL a few years back. I'm a significant shoulder shareholder of of PLC, more than 15% of the business, which gives me very strong incentives to wake up every morning and work for you, the shareholder. I've got an experience in multiple fields including IP, technology licensing, industrials, and medical, and I've done my PhD broadly in this area, venture capital investments many, many years ago. My colleague, Ed Cooper, who you you meet properly at the q and a, is a career corporate lawyer. He's got a significant experience doing m and a, fundraisings, IPO, joint ventures, venture capital investments.

7:13 So, again, it's a strong executive team that we can do a heck of a lot in house, but also build a good ecosystem around us to execute. On the nonexecutive side, we're complemented by doctor Charles Spicer, is our nonexecutive chair. And Charles used to used to lead health care at Nomura and Numis, so excellent investment banking experience. And he's also a serial chair and and nonexecutive director in the city. Jonathan Robinson is our senior independent director who is an experienced POC company director as well as somebody who has built his own business in next to it. And, again, this is the core of the board that's the core board that enables us to be efficient, pragmatic, but also with the right levels of checks and balances, complemented by Steven as CFO, and a team of about 15 people, that are on operations, helping us execute the model, and finally, venture partners and advisers that give us scale at little to no cost as we look to build our footprint in the companies.

8:16 If you go on our website, you can meet a broader section of our team. And I should also flag that we're quite active on LinkedIn so you can see kind of news items coming up from there. Now the what was the combined net scientific and EMV CAPITAL portfolio? Over several years, we integrated the businesses closely so that it is a combination of direct stakes and third party managed managed stakes. The portfolio spans biotech, medical diagnostics, industrials, robotics, satellite and telecoms, and other areas. It's a portfolio we know well. It's a diversified portfolio. Many of these companies are quite advanced now, revenue generating, some of them approaching a point where they might be mature for an exit. And, of course, in the context of PDS Biotech, a Nasdaq listed company that has multiple phase two immuno oncology drugs and now preparing for a phase three study.

9:16 A few years ago, we acquired a small stake in MARTLET CAPITAL, which is a well known early stage VC investor in Cambridge to get exposure to more investments. And as you may have seen in May, we acquired the mandate to manage market capital's portfolio of 50 plus companies with roughly £24,000,000 assets under management. I'll talk about the benefits for us in a second, but purely from a portfolio perspective, this again has once again transformed our position in that we now have direct look into and and to rights for pro rata into multiple into some of the most exciting deep tech companies in The UK right now. Companies such as Echion in superfast charging liquid iron, Paragraph, which is a global leader in graphene based semiconductors, CGD who are doing something really interesting around power electronics for the electric vehicle space, New Quantum, who is a leader in the in in the quantum cryptop crypt I was about to say crypto, not crypto, quantum cryptography for secure communications with multiple applications from defense electronics and beyond. Oxford Space Systems, which are providing antennas, Plumas in fire suppression technologies, docked within robotic sampler, substitute for plastics, and so on and so forth. You know? So, again, we're really excited about this addition. We have if you recall the model I showed you at the at the beginning, we're running through that model now through the portfolio, not only managing the portfolio on behalf of

10:48 market shareholders, but identifying follow on investment transaction by creation services opportunities for for the rest of our group. Very optimistic about this and really exciting stuff and very exciting to have such a deep exposure to the Cambridge cluster. Now let's look at the numbers, what's happened in the first half of the year. Of course, the big highlight here is that our AUM have increased to a 106,000,000, almost 107,000,000 from end of year 74,000,000. This was driven by the market capital transaction that I mentioned or the taking over of the fund management, 24,100,000 there, but also a number of other deals that have progressed during that period. As I mentioned, the balance sheet, the direct holding that we have is roughly 41,000,000, which has increased 15% compared to the end of the year. So, again, pretty strong forward.

11:39 I can't help but flag our current market cap is 13,000,000. So this, as you can see as you can imagine, makes us feel that there is a bit of a gap between where the market is and where we as directors who we might where where we should be. And the fair value the fair value of the managed stakes has increased significantly to 65,000,000 from 38,000,000 at the end of the previous year previous year. Combination of the market capital impact and further increases in the managed portfolio. Now with our model, what we did more than a year ago when we read the tea leaves and saw what was happening in the market, we said, listen. No more new investments. Of course, in the case of market capital, we've taken over an existing portfolio. Let us focus on supporting our existing portfolio.

12:24 It's gonna be difficult for some time to come. Let's focus on what's ours. So through this period, not only for the last half but for the last eighteen months, we have focused our corporate finance capabilities to support our portfolio. So in the first half of the year, we've done 6,400,000 of investment. I talked to some of the transactions that we've done. Each of this has been targeted in in the context of our portfolio companies recalibrating what it means to grow in in in this new environment, focusing on accelerated cash, accelerated go to mark go to market, finding new capital efficient ways of growing, and we've done our bit by supporting the businesses with our syndicated practice. And this has been important in protecting and continuing to grow our the fair value of our holdings overall, but also helping the companies to get to the next stage when they can access bigger external investment grants.

13:16 Last but not least, we have launched our fund management practice. We got we we gained the direct FCA authorization in February. It was a long important process. We're very proud of it. Globally, companies that are directly FCA authorized are seeing us head above shoulders in terms of the the investment space. But importantly, that enables us to launch and accelerate our fund management practice. In addition to the market capital fund may fund mandate, we have also relaunched our Evergreen EIS fund, which is also now poised to accelerate growth, again, a module within within our overall infrastructure. Group income has increased slightly to 1,700,000 17,000,000 compared to the previous compared to the h one twenty three of one point fifteen.

14:02 This has been almost entirely driven by EMV CAPITAL where our revenues have increased to 1,000,000 compared to h one twenty three. This has been modestly profitable. But importantly, remember what I said at the beginning that we've known to do only balance sheet investment. You would try to cover the costs as much as possible from from ongoing fees. That has covered 66% of the core costs of the business, of which we're quite proud. Back in 2020 when that scientific acquired EMV CAPITAL revenues at the operation level were close to zero. There've been no divestments during the period, so this is purely operational income. Now on on the loss side, again, if we look at what we call the core group, which is EMV CAPITAL PLC, not looking at the portfolio subsidiaries, that has been at 600,000 reflecting where the business is.

14:54 There's been a portfolio subsidiaries loss of 1,200,000. That's that mostly reflects continued investment at ProAxis and glycothest level. But in our model, while from an accounting perspective, we consolidate ProAxis, GlycoTest, and Centromed, we cover the funding needs for this portfolio subsidiaries with third party investments. So this is very important because, again, from a consolidation perspective, you know, we show them, but the the the funding needs of these businesses are covered by third party investments, not by PLC. So where are we in terms of the trends on fair value? So our fair value dipped slightly at the end of last year, and it has now increased back to where we were end of twenty two. A lot of this change has been driven by weakness in PDS, which is, you know, is a Nasdaq listed company, and Nasdaq has its own dynamics in the biotech space. But in the meantime, the privately held portfolio has continued to grow strongly.

15:56 It's worth flagging that this growth represents a three and a half times growth from from where we were at the end of two thousand and nineteen and ahead of the acquisition of EMV CAPITAL. That is a significant growth. Even if you take into account POC placings during that during that period, there's there's been 11,500,000 of placings. So if you add these two, you're still looking at a significant significant growth in direct fair value. In other words, we've added value to the portfolio. The fair value of managed assets under management,

16:28 that's third party investment. In mid two thousand and twenty, that was zero. PLC simply was not doing that. It is now at sixty five sixty five point seven million. Remember, we have 15 to 20% carried interest on these investments. This is not a forecast, but if it doubles or triples, you multiply it by the carried interest to get what that means for PLC in terms of cash coming back. And importantly, this is not shareholder funds. This is not PLC balance sheet. This is third party funds we manage and get the carried interest. On the net asset level, we our net assets are at 18,500,000, slight increase on '23, and our NAV per share has again increased slightly on the end of twenty three. Now when we look at NAV and NAV per share, it is important to flag that this does not account for the full fair value of the portfolio subsidiaries, again, simply due to accounting rules.

17:24 And also, it does not account for the implied implied carried interest. So we believe that that in terms of the potential future income to the business, that number is is higher. K. I won't spend too much time on this, but I'll just flag. If you looked at the company back in 2020, most of the value was concentrated on on four or five assets. Our continued focus on on the growth of the portfolio and deepening the stakes has kept the effect of diversifying our exposure across multiple companies so that no single company can bring us down in case, you know, downside scenario and that we have a diversified source of growth. But equally, that diversity means that we also have a diverse we're not passive. We are active. So we have multiple opportunities where we can choose to deepen or choose to exit.

18:14 This diversification is continuing. Now if you look at it from a asset class type, well, roughly, just on the half now is is direct of the AUM, and the third party is the majority. And if you look at the composition between funds direct into the part but, again, you can

18:32 see how this is becoming diversified. We see this as a positive. It's diversifying our exposure to risk and diversifying our exposure to opportunities. I'll I'll spend a little bit of time here on the market capital fund mandate, I've spoken about before. We've had some more time now to integrate the team, integrating the portfolio, and think about what this means about for for us about the future. So it's been only a few months since we did that, but during that period well, certainly, of course, it it adds value. So actually, the we've added 900,000 to the to the fair value. The acquisition price was lower, so the portfolio is continuing to perform. Of course, we get carried interest over the market portfolio so that as the as the as the portfolio exits, PLC gets carried interest back. We also get recurring fund management fees over a minimum of four minimum of four years, potentially longer.

19:27 But strategically, we get a deep network within the Cambridge high-tech cluster, which is considered the leading high-tech cluster in deep tech outside of Silicon Valley. And the sort of opportunities we're seeing there are truly amazing. It is really stuff that will change the world, and we get the opportunity to participate in that and apply our model. We also have an enlarged team of specialists and multidisciplinary VC experts that complement our team's work. As I mentioned, additional opportunities, and we have work in progress for a follow on future fund, market to that we would look to raise to continue with this investment strategy. It's quite important that while the market brand remains distinct, it is integrated within the group. It works within our overall framework. It works with the other modules. The team members work with each other, really excellent prospects going forward.

20:18 In previous discussions, I probably gave you a headache by going through six or nine or 12 companies. This time, I'll give you a slightly smaller headache by just focusing on three three opportunities. And what I what I want to show here is how we use our playbook or different playbooks for different companies, but in each case, we end up with a mega exposure to potential returns from really interesting companies. This is focused on the upside. Of course, within a portfolio, you would expect that some companies might not make it or they won't make the returns, but this is focused on having the upside. If PLC itself is a breakeven on the back of operational fees, all of this is free upside. Starting with Soft Funds, a company I've talked about before, they provide they have developed let's say, Edinburgh University spin out next generation satcoms antenna that is lower energy, solid state, so it doesn't have to move to track the satellite modular.

21:13 It has uses in aircraft airframes. If, you know, the bump on your when you get into the aircraft, you get broadbands on your aircraft. So that's what this does. But also application for drones and terrestrial applications. Now in terms of their roadmap, they're progressing a JDA with ViaSat, the world's leading telecom a world leading telecom company. That includes a multimillion purchase order. That's the moment that the company is the product is licensed and fully regulated to operate. They'll get a purchase order to to to implement that in BioCell's applications. There's also a project with European Space Agency and other satellite operators. Earlier this year, EMV CAPITAL PARTNERS, as is now known, or subsidiary, led and closed the 3,400,000 investment round in very difficult circumstances, we're quite proud of it.

22:05 But why are we doing this? Well, this is in the context of a fast growing market for the use of subcoms everywhere. You you all know about Elon Musk's Starlink. It's not just going to be Starlink. There's multiple constellations in development, and this will transform the sky. They could

22:25 transform Earth as well. We ex the company expects this market to be worth $14,000,000,000 by 2033, and SOFANT is one of the leaders in that space in terms of the antenna side. Our exposure here is mostly to to advice. We are now the biggest shareholder in so far. We started off as one of the smallest ones. And, again, our exposure here, you know, for potential exit is true to carry the interest. Turning to glyco test, the company you're familiar with, they develop a biomarker panel test for it will take me another six or seven minutes to finish this and then we'll go to q and a, but I think it's important to go through these examples so get a bit more context. So they are focused on detecting early stage curable liver cancer. I find it a scandal that liver cancer is a curable disease, and the reason that people die from it is because many of them simply don't get diagnosed in time. Glyco displays in this space.

23:20 Now it has global application, but we already have an ex our existing strategies licensing to China through our Fosun relationship and commercializing in The US, through a clear lab, a lab developed test. On their roadmap, they've now completed an enrollment for the clinical validation study. And as a result, Glypodest believes it has the world leading biobank of liver cancer blood samples. That is quite something to have. Recently, post June, well, GLAPITAL signed an agreement with University of Georgia to revise and strengthen the performance of their panel test, which is a key point on their road map to commercialization and launching this test in in The US market. In line with our capitalized strategy, EMV CAPITAL advised on a 2,000,000 fundraise earlier this year.

24:05 There's further funding that the company is seeking from the market. The early early year one was million from Fossil, million from from private investment. Again, why are we doing this? Believes that in The US alone, there's a billion dollars per annum underserved market for liver disease diagnostics. They believe there will be the the next gold standard, and they have a way of commercializing that within over the next few years. Globally, it's an even bigger market, and that provides the company with an excellent commercialization opportunity. Exits in this space tend to be in the multi $100,000,000. Again, this is not a forecast. We couldn't possibly forecast what happens, but from glyco test perspective, they see really strong prospects. Our exposure here is significant. We have over half of the business in terms of direct holdings, 6% advice. That's third party money. We expect over time we'll drop below the 50%, but our advice to the stake is likely to increase.

25:02 Again, excellent opportunity. We know it very well. Really strong exposure potential for growth. The last one of luck here is deep tech recycling. Those of you that follow us may remember that Deep Tech Recycling was formed on the back of the acquisition of the assets from the failed Recycling Technologies. Recycling Technologies was a fascinating company. We were following. They were developing a plastic waste management recycling process. They, came short of a, a planned IPO where they were planning to raise 40,000,000 on roughly 80,000,000 pre market valuation.

25:36 And we were able to back the team to restart that business on the back of a of an SPV. Now EMV CAPITAL gained a 30% direct exposure for nil or close to nil cost. Why? Because we were the guys that were able to syndicate the rescue round, put together the team, put together the money, and take the company to the next stage. Importantly, we're following a capital light investment model whereby we're keeping the IP and technology safe, you know, Topco. And then where it comes to launching plants in each of these plants is 20 to 30,000,000 pounds. We're working with the client. We're working with those whose headache it is to solve the plastic problem. So now we have a first commercial project with a major international packaging producer group who

26:22 have a really strong regulatory incentive to come up with a solution here. And we also have an MOU for a second project with a Scandinavian player that the company is looking to to develop. There are other opportunities under development. On the funding side, EMV CAPITAL led a 2,100,000 EIS investment raise, and that led to a significant increase in our fair value exposure from this business. While we're doing this, we believe the Big Tech Recycling believes that the chemical recycling plant market, as in the market for new plants, will be 140 to £250,000,000,000 over the next decade or so. Some of you might have seen an article in the Feet just over a week ago where the state of California is suing ExxonMobil ExxonMobil because they believe that they understated or how difficult recycling of plastic is.

27:15 Well, only 10% of plastic is can be recycled in a mechanical manner. Most of the rest of it has to be from chemical recycling if you want to if you want to make it a sustainable proposition. Deep tech recycling is playing in that space, a truly massive market, and we're very excited to back the team. Now I can talk hours and hours for all everyone of our company. Everyone has their own story. Everyone has their own model. The point we're making here is that we're not passive money sticking in a check. When we go deep into one of these businesses, we work with the management to understand the model, to syndicate investment, gain deep stake for for for for PLC alongside third party party money and therefore get the investment returns. So going forward, where are we going with this?

28:03 Well, I've given you both the playbook that we're we're we're working with, the examples of the companies, and I've also given you from a fee generating perspective how we do that on on on the basis of paying for our costs, and also I've shown you how our privately held portfolio has grown over over the last half a year and and beyond. We believe the model works. So we'll continue to grow the value of our portfolio company holdings through proactive management, value creation services to drive the ambitious road maps of the companies we close to, but also targeting our growth of our direct stakes in some of these companies in a capital efficient manner. We'll look to scale the funds practice. This is a big part of our future that will increase our assets under management. It will increase our firepower to support these businesses, and it will increase the carried interest for for our business.

28:57 We want to achieve financial stability and independence through the tools that have identified. We believe we will establish we've got a route to breakeven on the back of recurring and transactional fees. And, of course, there's always the potential of selective secondary market partial sales of some of our portfolio companies as we've done in the past. And last but not least, routes to exit. We're working with the selection of our companies to prepare them for m and a to drive the the value improvement and identify potential acquirers. And over the last year, we have built a panel of advisers that we can work with as as and when needed. So on that, we'll stop for we'll stop for for for m and a. Hope you enjoyed the presentation and the team just under thirty minutes.

29:43 Perfect, Ilian. Thank you very much for your presentation. Ladies and gentlemen, please do continue to submit your questions. You can do that just by using the q and a tab, which is situated on the top right hand corner of your screen. But just for the company, take a few moments for you the questions that have been submitted today. I'd like to remind you the 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 questions throughout today's presentation. And, Ilyan, if I could just hand back to you to read out those questions and give responses where it's appropriate to do so, I'll pick up from you at the end. Okay. Thank you very much. And we'll be speaking for a while. So, Ed, do you wanna take some of this some of the questions? Ed, you're on mute, I think. Ed, I think you're on mute. Thanks, Elliot. I'm just having a look through the questions at the moment on on our screens.

30:35 There there are some themes coming up, which is which is great to see, and and the themes that we're obviously aware of, on our side. One common theme, I think, that I'm I'm seeing from a number of the questions is the disparity between our current share price and the stated fair value of our both our direct investments and those that are under our management. And I I think we you know, we're we're highly conscious of the delta between the current share price and that value. I think perhaps just a brief explanation of how we reach our fair value. So this is a tried and tested PVCA valuation guidelines model that is carefully pulled over by the team here, the board, our team, and our auditors.

31:26 So we're we're confident in in that fair value as stated. Indeed, we, you know, as Ilian has tried to bring to life, we we have a very active involvement with these companies, and we're seeing now, ahead of that BBCA value, which is a look back valuation often to the last point in time where where a recent share price has been tested. I think that in itself is of great confidence to us. So these prices aren't prices that have just been set by EMV CAPITAL, but rather by third party investors in these companies. So that that in itself, I think, is a real true test point for us. And and and these test points are also relatively frequent with the current state of play with a lot of the companies, that they're raising money on a frequent basis, and and therefore the price is continually stress tested by those coming into the company.

32:26 And I think, ultimately, the proof is in both the next price pricing round whenever a company, continues to fundraise. That that that obviously helps us all shore up on on the pricing, and you'll see that as as and when we undertake an announceable fundraising within the portfolio, we're we're very keen to put that out into the market for you so that you can see where where a price has gone up or down. Ultimately, the proof is in the pudding, and, the the the the real price of all of these assets is the price that a purchaser would pay on an exit. We're we're not at an exit phase yet with any one particular company.

33:11 We we've mentioned in the past others. But, anyway, that that that's the, that's the fair value that we're looking at as the share price that's really market driven. And, we we're obviously as shareholders ourselves, we're keen to see the price go up. From a company perspective, we're also keen to see the price go up. So I hope that addresses at least one of the themes there, which which I'm seeing in terms of the disparity between the pricing and the actual value. Thank you, Ed. And just to add to your point, we're we're absolutely not in the camp of blaming AIM in the AIM market for for everything. You know? We're we're just getting on and and doing our business. And, ultimately, we believe that matters is real performance.

34:06 Having said that, of course, I need to point to the unique state in which the end market has been over the last eighteen months or perhaps longer, not as an excuse for us. We are getting on and doing our business. But on but on the pricing side, it just seems to be a unique confluence of of factors, and some of our VC peers seem to be trading at similar discounts to to to fair value. Having said that, we have to be ambitious, and we believe that signals such as we believe that the company has a route to breakeven over a certain period of time that we it is possible to calculate from the numbers we've given you any potential combination of of exits, what their result not only in carried interest, but importantly, balance sheet coming back to to our business that that the that the gap is is indeed between a return scenario and where we are right now, the gap is indeed, well, surprising, let's let's say, for a for a well developed efficient market.

35:22 From our side, what what can we do? Well, we need to continue to communicate with you. I think the I promise to talk a bit about the rebrand and and part of the reason for the rebrand was that. I think there was a bit of a confusion on the market. Well, what is that scientific PLC? What is EMV CAPITAL? Do you guys work together and so on? And so as as part of our strategy of, look, it's a single house, single approach, multiple playbooks, multiple tools, we we made this decision of let's move towards a single brand that's recognized not only by PLC shareholders and and players, but also more broadly in the market. And we hope this consolidation of the brand will be will make it a bit easier to communicate what's what's happening at at a group level.

36:11 I would also point to the research that our colleagues at Panmure are doing and others in the market that are publishing that, look, we spend a lot of time working through through the numbers and the explanations on that. And it it's for the market ultimately to decide what discount to provide on those on those numbers. But from our side, we'll keep doing what's what's right. You know? Ultimately, we don't think the market can re ignore when returns come into the performance continues to improve. There was a question around a a timeline for planned divestments or exits in the portfolio. I think that's a great segue.

36:56 If again, if I can contrast the classic fund model and and what we do. In a classic fund mono fund model, look, if you invest in enough companies at some point, exits will start coming through. There is an element with that with in terms of our increased exposure now to 70 companies. The statistical probability of an exit increases, of course. But the way we approach this is, look, we don't have to wait until a full exit on m and a and IPO for us to take money off the table. We have shown in the past, last year in particular, that we are able to take money off the table profitably through partial sales while continuing to to to keep a a stake for the upside. So that very much remains a part of our of our strategy.

37:42 But we we don't want to an exit and a sell down at any cost. So in that sense, we're quite pragmatic and opportunistic. I think it helps us being close to the portfolio companies that we really understand what's happening. We understand when there is a good time or a good opportunity to do to do a secondary, and we also understand when the time is not right to think about the secondary. I also mentioned the more proactive work we're doing with with our portfolio companies. Look. A good a good example here is ProAxis. If you recall earlier in the year, we mentioned that ProAxis wants to explore strategic options that we appointed an m and a adviser on that. And so they went out. They spoke to the market. In the current market conditions where Paraxis is, we were they were not able to identify a good exit and reflected in this in the interim accounts. So you can read more about it there.

38:37 But the way we saw it is, look, that is something we were right to do. Now what did we learn? Well, the market gave us really good feedback in terms of the bits of the business they see valuable, the bits they don't. That has enabled the the the board to make its own decisions in terms of how to streamline the business further. But I've also identified potential partners that may well be an acquirer in the future or potential investor in the short term. So it's it pays for that for the companies to be close to the market, and we'll continue to encourage our businesses to engage early with the market to get to know their potential acquirers early on so that they're more in control of their destiny. There's another question by by George.

39:24 And, George, the question I answered just now was also yours, around how do you decide which companies receive additional investment or support from EMV CAPITAL, what criteria are used are used to allocate resources most effectively. So so I think, look, as I indicated, there's a lot of interesting stuff out there, you know. And if you're in the venture capital space, you're bombarded with with excellent and interesting opportunities. So it takes an enormous sense of discipline not to be distracted and to focus on on what what we have. So I believe last year, the only new investment we did was the deep tech recycling investment. And the reason we did it is we knew it very well, and the opportunity was massive, and we knew exactly what we will do with it. You know, we were very well prepared to execute.

40:13 But within the existing portfolio, we, you know, we have board representation on most of the companies that we are actively involved in supporting. We understand the opportunities. We work closely with the existing investors in those businesses. And there's a lot of thinking with those companies about the investment strategy that they're they're focusing on, how they're gonna get to the next value inflection points. And I keep going back to this capital efficient point, you know. Equity investment is the most expensive money you ever take. Maximize all the other sources, you know, maximize the joint development agreement opportunities with the corporate, grant opportunities, and that will increase your value and make an equity raise more more efficient. Within that, of course, in the current market, you have to make some choices. You know, you have to prioritize some companies over others, and those are the difficult decisions we have to make.

41:09 Ed, maybe a question for you on a buyback options. Yeah. Thanks, Celine. There's a there's one or two questions again sort of showing a bit of a theme around whether we would consider a a a share buyback. So we we recognize it obviously as a a helpful tool in closing the gap between the existing share price and and the underlying value of the portfolio. That said, it it it's a a complex transaction in itself. It needs distributable reserves, which currently PLC doesn't have. We have the means to address that in due course if that's a route that we want to follow.

41:56 But I think we also need to balance that out against the company's ongoing cash management needs, and it and its capital efficient investment, requirements going forward. So at at the moment, we have a very careful, handle on the cash situation, and we invest in a very capital efficient manner as as Ilian has suggested. Right now, we're looking at a a more of an evergreen model for the business, to ensure that, we are strategic in our investments in the existing portfolio. But, obviously, we can't rule out, in the longer term when we do get to a phase where there are significant returns for the company.

42:42 A buyback could very well be, the right thing for the company. In the meantime, I think the hope is that if if we get to that point, the share price, naturally in itself, will see increase. So so we really need to sort of stress test it at at the time of the occurrence of the cash influx. Thank you, Ed. There's a few questions about is there a potential overhang, on the business because of expectations of a discounted fundraise? Is there working capital to see us through the next exit? So, again, I mean, as the CEO of a PLC, you know, there's only so much black and white I I can give as you appreciate. But what I'll point you to the is to the following. We haven't done a placement for more than two years now. We recognized that the markets were horrendous, and we found a way to work through that. That has made us stronger.

43:40 In the first half of the year, as you saw, we've covered 66% of our costs through ongoing fees. And through the addition of fund management mandate, we have additional recurring recurring fee income. During that period, we sometimes it's good to go on a diet. Sometimes it's good to have a fitness regime. So I think our internal processes have been significantly improved in terms of cash management. There's some metrics in the in the interims that you'll see that show our cash management has has improved. And as a result, we are, I believe, operationally a stronger business. In terms of going consent considerations, if that's okay, I'll just point you to the annual reports that we published in in May where there's a a written out statement ongoing concern strategy that was coordinated with with our auditors, which which I think states our strategy for the year end, and we are certainly within within that strategy.

44:45 I want to emphasize again, in terms of our model and, you know, in terms of the way we think about model, it's not just the next six months, the next nine months, the next twelve months. We have internally a three and a five year financial model. There's There's only so much you can forecast five years, but we're mapping out our strategic goal of adding a a second fund, adding a third fund, potential distributions, and so on. So we are very much forward focused. You know? The first half of the year speaks for itself. I've given you sufficient commentary, but we're very much focused not only on the next six months to the end of the year or three months now, but we are focused on the next three and the next five years. We're building something for the long term. Within that, operationally, we want to get to breakeven on the back of current fees so that the carried interest and the sale of balance sheet positions are the upside for PLC and its shareholders.

45:44 There's a there's a related question. So just to go back to the question, is the fear of a discount place in keeping investors away? Again, if I look at our discount level between fair value and where the price is now, it's comparable to some of the bigger players such as one beginning with an m and another one beginning with a with an I who are who are whose valuation is in hundreds of millions of hundreds of millions. So so I think our discount is comparable to that of the bigger players, which I could play it as a positive, but I don't see it as a positive because the discount is too big. But we hope that indicates that how the market sees us. K.

46:30 And do you think from the remaining questions, is there anything we haven't answered? I'm just looking. I I I I I I hope we've covered all the sort of main themes of of the questions. As I say, there there are a number of sort of slight variations on each one, but I I believe we've covered the the the general themes in this. That's great. I'll just jump in there, and thank you very much for answering those questions from investors. Of course, the company can view all the questions submitted today. We will publish those responses out on the investor me company platform. Just before redirecting investors to provide you with their feedback, and it's particularly important to you both, Ilind, can I just ask you for a few closing comments if that's okay? Thank you. So, guys, it's those of you that have stuck with us over the last few years, I want to thank you. There were a few notes here that some of you have been in the stock for two years, some of you more.

47:24 And in that period, the price hasn't behaved the way you or we would have wished. So I I want to thank you for your continued support. What I want to say is that we all know we're living in extraordinary times at every level. In the newspapers, you you read the political and economic aspect, which drives some aspects of our market, but what we live in is the technological, scientific, and market change aspects of that. It is a time of tremendous change. And we have built a platform that has that is able to operate in this space and to identify some of the leading opportunities, leading technologies and products, the companies that will change our tomorrow. I'm not just saying this. You know it. Look around us. Whether it's AI, biotech, robotics, you name it, most of today's leaders that are changing your life every single day, including this technology we're using to talk to you right now, were not around five years ago, ten years ago.

48:21 And the the pace of technological change is increasing. The next cycle of economic growth will be driven by technology. There is no way around that. It will be driven by technology being deployed to markets. What I've taken you through what I've taken you through is examples of in the medical, in the semiconductors, in the sustainability and waste management space, and many other examples in quantum and so on. Each of those has the potential of transforming an aspect of our lives. That is good for us as citizens to think about that, but for you as investors, we are inside these conversations as a competent financial engineer with with some investment behind us, and we're able to identify those opportunities and next and to take advantage of them. We are incredibly excited as a team. We are incredibly excited not just about the next year. I mean, it's people are excited about the next three and five years.

49:14 And we think that for our PLC shareholders, there should be returns all the way through as as the markets recover and what we're doing becomes recognized. But we are here and we're committed to what what to to building a leader in this space. As I've said in the past, new leaders in the markets are born in times of crisis. The venture capital industries just now starting to emerge a time of naval gazing crisis, incredible volatility, and we believe our model is one of the models that will for the next cycle of the VC space. So we see a mega opportunity here. That's what makes me get out of bed every day, and I hope you get to benefit from it by by working with us. Thank you again for your support. Thanks for those comments, and thank you for updating investors today. Could I please ask investors not to close the session as you now be automatically redirected to provide your feedback in order the management team can better understand your views and expectations?

50:09 This then take a few moments to complete, some should be greatly valued by the company. On behalf of the management team of EMV CAPITAL PLC, we'd like to thank you for attending today's presentation, and good afternoon to you all.