Light Science Technologies Holdings (LSE:LST) — Company Update

0:01 Good afternoon, ladies and gentlemen, and welcome to the LIGHT SCIENCE TECHNOLOGY HOLDINGS PLC Investor Presentations. Apologies for our slight delay in starting today's presentation. Throughout this presentation, investors will be in listen only mode. Questions are The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it's appropriate to do so. These will be available via your Investor Meet company dashboard, we'll send you an email when they're ready for your review. I'd also like to remind you that this presentation is being recorded. Before we begin, we would like to submit the following poll, and I'm sure the company will be most grateful for your engagement and your response. And I'd now like to hand over to Simon Deakin, CEO from LIGHT SCIENCE TECHNOLOGIES HOLDINGS. Good afternoon, sir.

0:52 Good afternoon, and welcome, everybody, to LIGHT SCIENCE TECHNOLOGIES HOLDINGS PLC. I'd just like to introduce just the team first of all. To my right hand side, there's Andrew Humsell, chief operating officer. Hello. Jim Snooks to my left hand side, chief financial officer and company secretary, and myself, Simon Deacon, chief executive officer presenting to you today. We are going to give you a short introduction into the company via video, which we will show you now. That's very kind. If you could just press mute, that would be great. Thank you. SCIENCE TECHNOLOGIES HOLDINGS two companies within it, UK Circuits Electronic Solutions based up in Manchester, and that's our manufacturing site and our base company with 24% growth last year with a 6,900,000 turnover.

1:54 That has great synergy with our other side of light science technology, which is in the CEA market, which has a quoted project and pipeline of over £40,000,000. Our market opportunities are worth over 20,500,000,000, and the CEA GER is 21.1% to 2025. Founded in 1997, UK Circuit Electronic Solutions and Contract Electronics Manufacturing, CEM. In 2020, UK Circuit's turnover grew by 24%, which is an outstanding in a very difficult year, to £6,900,000 with a current forward order book of over £5,000,000. The business has grown strength to strength.

2:41 We're in sectors in pest control, lighting, automotive, electronics, and the oil and gas doing sensory products. So when I bought the business UK Circuits Electronic Solutions in 2016, we grew the business over a period of time through organic growth as well as doing an acquisition of on time communication, was in 2018. In 2019, we started developing the CEA product to create a recipe for the enclosed environment. In 2020, we also got an Innovate UK grant working with universities in Derby and Nottingham. Also, we got a turnover in 2020 of 6,900,000, which was a 24% growth.

3:27 Our labs opened in 2021 here in Derby, and now we have a pipeline of over 40,000,000 for the CEA market. Okay. So in the words of David Attenborough, we need to rewrite our story to turn this tragedy into a triumph. We're all, after all, the greatest problem solvers to have ever existed on Earth. We now understand this problem, and we must halt carbon emissions this decade. So some information now on sort of there's lots of global trends driving the CA revolution. So we saw Brexit. You've got a lot of driver pickers at the moment. You've got sort of picker shortages, particularly in our industry with things like fruit where, you know, lots of harvests are going to waste because there's nobody to pick them.

4:15 With COVID, last Christmas, we saw all those tons of rotting food. When France closed the borders, you know, you saw those queues on the motorways for days there. And, and, again, this was highlighted at COP twenty six. You see there that there's more you know, climate change is driving more environmental disasters. And what that does is that puts more risk in the traditional, farming chain. And What they do to mitigate that is they'll grow duplicate fields. So they'll have one in The UK. You'll have another one in California or Spain or something like that just to mitigate that risk. But, obviously, there's no contract for that second farm, so one out of the two farms will go to will go to waste because there's no short term requirement for those products. So on the water shortages side, CEA uses 95% less water than traditional farming, which in itself accounts for around 30% of global emissions.

5:05 You've then got the dietary shift to plant based diets. So meat consumption, that's reduced by around 17% in the last decade, and that's kind of accelerating as time goes on as well. So in summary, we've kind of looking at a world where we've kind of got a growing population. The UN predicts we're gonna have about another 2,000,000,000 people to 9,600,000,000 by 2050. But at the same time, you've got a reduction in the land available to to in those ever increasing restrictions. So, you know, you can see these pinch points all coming together. So this is all driving a move to grow locally. So in the CA market, you've got players like IKEA. They're putting a vertical farm at the side of every one of their stores, and the idea there is that they will grow the salads that they sell in the in their cafes. You've got Ocado.

5:54 They own over 70% of Jones Foods who are one of the key participants of the industry, and they've got an ambition to put a vertical farm at the side of all of their distribution centers as well. So, you know, the CA is addressing a lot of these issue these macro issues, these global issues. And I think it's a case that global forces themselves, that the market forces won't be enough to solve the problems, and that's gonna need government intervention. And in the national food strategy produced by Dimbleby in July this year, he was sort of making a recommendation that £500,000,000 of government money comes into the sector. And interestingly, this was really geared around direct farming

6:35 projects rather than going through the academia route and then into projects. So it's a much quicker route to to projects sort of happening. So which is really good news for the industry. Now I take you through some industry forecasts. So as Simon mentioned in the video, there's an estimate CAGR in the industry over five years of 21%. And this here, we're looking at a snapshot of 2024. The two fastest growing markets are forecast to be Europe and APAC. That particular area shows you 2,670,000,000 in the total available market. And what we've done to get to an addressable serviceable market is we've reduced things like high pressure sodium lamps and also cheap website proprietary items. You know, we're not a catalog type company. So we've removed those, and that gives us that 1,200,000,000 serviceable market.

7:30 So a bit of information now about the sort of market segments that we serve. The controlled environment agriculture sector is grown by 36% in Europe in 2020. So and I think it's important to stress that, you know, we don't just focus on vertical farms. They're the sort of projects that everybody hears about in the news, but, you know, as you can see, they are the smallest segment. They are growing very much as well, but, you know, we don't just serve those. They are very high value projects. But then the flip side of that is they're quite lumpy in their revenue generation. They're much longer term wins.

8:06 What we do here is we we then service the glass outside and the polytunnels. We're just as much interested in those. So whilst there'll be much lower value projects, there's lots more of them. So you can see there's a sort of five times as many polytunnels as well as glasshouses, and you see glasshouses is over four times the size of the vertical farm market. And I think a lot of nuke entrants are really focusing on that vertical farms, whereas we're not. We're kind of focusing on the sort of working alongside the traditional farmers in the glasshouses and the polytunnels. So so that's that's really sort of you know, the polytunnel one is an untapped market. That's a really exciting market for us. I'll hand you back to Simon. He'll talk about some of our products. Thank you, Andrew, for that. So let's just have a look at the products we're providing and services.

8:54 So our compatible smart technology products and services. So what have we got? We've got lights, and you might think, oh, what's special about the lights that we we provide? Well, the lights in the controlled environment agriculture are really important because you need to create a recipe of light for the right family of species of plant that you might be growing. So it's important that you get the recipe right, and we've got over 44 different types of product for this environment. But what's unique about our product compared to our competitors is our product is over 90% recyclable at the end of its life. But more importantly, it's reusable. There's no point in having a product which is just thrown away at the end of its life and not reusable. It's all about now reusable and making sure that we use we use the product as we go forward and creating a partnership with our our customers going forward. So what happens is we have a body of a product, a light, and we can change the innards. As you saw from the video, we've got a perfectly good company within UK circuits doing electronics, and we can change the innards which we manufacture here in The UK up in Manchester.

10:11 And so that after four to six years of use, the lights will start deteriorating. The human eye won't see it, but the plants will notice it and the yields will change. So what happens is we come along, we get a recurring revenue pattern with long term contracts of over twenty years, and we start replacing the innards, the new

10:34 electronics, the new smart technology going in into that light fitting. And that saves the client 30% on renewing his light source. And, obviously, there will be more energy efficient as technology expands and grows going forward, which is really important. What else do we provide? Well, on the other side, on the right hand side on the slide, you'll see technologies, and you'll see this green blob. Well, our green blob is a product, which is a sensor product. And that sensor product sits either in the ground or floating in the water, but it it sits within a glasshouse, polytunnel, or vertical farm, and it starts collecting big data from the environment that you're growing in. And if you can see what you're growing and how you're growing and how to control that environment, you'll get better yields.

11:25 But we don't just provide information. How do we know that the information is correct? Well, we've got a lab with scientists in it, and this lab will recreate your growing conditions in a vertical farm or in a polytunnel or glasshouse. We'll take those growing conditions and recreate them in our own growing rooms that we have based in Derbyshire with our scientists. And we will be able to see how your plant grows depending on the species you're you're growing and then improve it and then give you boundaries of what you need to grow that plant and improve the growing conditions. So using real live streaming data, we can pull all this together with our scientists and our lab and and bring it all together

12:07 to provide a turnkey solution. And what I'm going to do now is show you another short video on on the lab and our scientists and what we do and and a bit more in-depth on the equipment that we use. Is a bespoke lab. It's been built specifically to understand and work in plant biology and working with farmers. The lab is built in a way that we have a whole section which is specifically for preparing samples for analysis. We have an area which is just for seed preparation, for planting into our grow room in which we we've got six grow chambers. And later in the year, we're moving into an even more bespoke facility that has two large walk in chambers.

12:55 Specific recipes are really important to growers. They need to make sure that they have the right amount of nutrient, water, light, temperature and humidity, c o two around a particular crop so they can get the best possible yields. We need to understand exactly the environment they're

13:10 growing in, what type of crop they're growing, and the conditions that they have available to them. It's at that point we bring in the high-tech, and we start to tweak those environments and add in the specialist light to solve the issues that may be there.

13:33 Right. So just to understand, and you've had a piece there from John regarding how the lab works and how it brings it all together. But what our our our sensor does here, it captures airspeed, humidity, c o two, and the temperature of the building that you're growing in. It also looks at plant performance, the the moisture of the ground and monitoring the growth of of your plant. And on the other side, it measures the oxygen saturates in the water, the pH of the water, and the seven key nutrients that you need to grow a plant in the quite correct way to get the maximum yields. And what we do there is you're getting a demonstration there of a glasshouse on the left hand side, but it goes all that live data goes back to the lab as you just saw in the video. They recreate the conditions so that they can then give you the data back to what growing conditions you need to change your environment to increase those yields. And

14:36 then we're talking about increasing those yields from four or five a year to up to 15 to 18 yields a year, which is a huge increase for the grower and the farmer who are growing these crops worldwide.

14:54 So let's have a look at a contract that we signed recently. You might have heard about it in the news with Zenith. It's worth just over £13,000,000. It's very exciting for us. And what we're providing here is a turnkey solution. We're bringing all our technology, the sensors, the lighting, but also a cloche product, which we've developed with our partners, Moorish, where we're putting together what I would call a train, if you like, carriage on a track, which has got technology below it, and it goes floats above the ground. And what it does, it provides in one carriage, it'll provide lights so that we're getting the maximum amount of light with the right recipe of light from our products over the soil in a polytunnel or a glasshouse.

15:48 It will also put sensor products in there, so it's sensing the environment so that these a bit like, if you like, on this cloche, a robot controlling it going over the ground. But also with it, it will also seed the ground, so it'll settle the seeds, it will plow the ground, and also will harvest. So what we're striving to do here is where there's issues of labor shortages for growers worldwide, we're actually starting to look at how we can be more efficient and bring those yields from that four to 18 yields a year and grow more importantly, which is really difficult to do in Europe, is grow all year round, twelve months of the year.

16:35 That's not been possible before and hasn't been done, but this is looking at growing twelve months of the year. And what that does for the grower, it means that it's stopping importing produce from around the world to fulfill their contracts they will have with the supermarkets. And and that means that your food from harvest to plate in in this environment will be three days rather than over a week if you were importing it by air or by lorry transport. And we know how difficult that is now in the environment that we are in with COVID. It's extremely difficult transporting goods around the world, and it's become extremely expensive. But also, it's really important and where the supermarket's looking at it now is what damage is it doing to the environment.

17:22 We all want to know where our food has come from, where it's grown, and if it's grown locally in the country that you live, it will taste better. It will actually be cheaper. And, also, it will be good for the environment bringing down carbon monoxide, which is really important and a hot topic and will be throughout our lifetime.

17:45 Okay. I'll talk to you about our recurring revenue model. We don't believe in giving sort of farmers the hard sell. We think trying to go in and sell products isn't the way forward with them. You know, our sales team are actually agronomists, so they go in. They understand the farmer's problems, and we effectively try we create a brief, if if you like, that's based on an ROI for them, you know, return on investment, whether that's lowering energy costs or improving their yields or whatever. And, really, what we're showing here is we're trying to create as many touch points as we possibly can

18:17 as with with the farm. So it's a partnership. So first of all, the lab the laboratory will come in after the agronomist has gone in, looked at their sites, We'll then start to look at what they're growing, what are they trying to achieve, and we'll then start to create lighting recipes, which we can then back up in our lab to know that they work before we implement them.

18:37 Then that will lead to the hardware order, if you like, the lighting and the sensors. But, really, from then on, you know, you don't just plant something and run it for five years and never change. You know, there's gonna be tweaks and changes where the consultancy comes in and then further lab trials and things like that where you're trying to get for even better energies and better yields as as time goes on. There's also that ongoing software partnership and, you know, having some kind of skin in the game, if you like, with a with, you know, with a monthly revenue coming in from software. In effect, that's a massive pressure to keep that working, or otherwise, they're gonna be canceling their subscriptions. So that that's we've gotta keep that running. We make sure that the farm keeps running with preventative maintenance. So we give a warranty with every one of our products, and we will then also extend that onto on-site because, obviously, it could be quite critical if you start getting failures and things like that.

19:29 So we offer that as well. We'll also consult as time goes on when they want to grow new things. And then every five years, as Simon was saying, the lighting will you know, when the lighting comes to end of life every five or six years, we can go in and just change out that inner portion of the PCB and LED board, leaving over 90% of the product in place. So, really, what this is doing, this is creating a really strong vertical chain, and we're there all the time, and we're they're ready for that recur those recurring revenues through throughout anything up to twenty five years, really. We've had the lights tested for, the aging of all the different components in there, and we're confident we can get twenty five years out of product. And that still allows the grower to capture future innovations of LEDs and things like that that come in as well. So it's it's a really strong vertical chain that we're building here.

20:21 I'll hand you to Jim, who's going to talk you through some finance. Thank you, Andrew. So I'm going to review the historic finance information with a focus on UK circuits, which is the platform business in the group. It's a business that's been trading for twenty four years, and it's profitable and cash generative. We put a slide in the appendices in relation to the highly innovative life science technology side of the business, primarily represented by r and d costs and establishment costs to get us to the point of commercialization that Simon and Andrew have covered within their presentations.

20:59 So looking at, UK circuits, what do we see? We see a solid growth through the time window that we're analyzing. In particular, a 24% growth in revenue from 2019 to '20 in a year of historic turmoil given the onset of COVID. We see that revenue growth continue for the half year '21. Our financial year end is November, half year May. And typically, our half year results are sort of lower in in turnover than the back half of the year given the industry wide Christmas, Year closed down. So that's a a pretty typical picture that's represented.

21:43 Very consistent margins, gross profit margins within the business, 23, 24%, which given the growth in revenue with the consistent margins, what we see is a direct translation down into incremental EBITDAs throughout the period and also in terms of cash generative cash generation through the window. We have a current, forward order book of £5,000,000, which gives us great visibility, going through the financial year that's just started being the first day of the new financial year. And in summary, UK circuits, it's both a profitable and cash generative business.

22:30 So if I can hand you back to Simon to do a summary of proposition. Thanks, Jim. So I'd just like to sort of round up really what the true investment is here. We our our turnover grew 24% last year, so really good growth in in the COVID period. It's a £20,000,000,000 market that we're we're going after here, and it's worldwide. So we've got great opportunities, and we're working worldwide. As Jim mentioned, that we've got over £40,000,000 worth of quoted business in the pipeline currently. As two companies together, UK Circuits and LIGHT SCIENCE TECHNOLOGIES, we've got a forward order book of over £18,000,000 currently.

23:20 So the visibility and the future going forward is strong for us.

23:26 The need for growing locally in the country that you're in is extremely important, especially with what's happening with the environment, the warming of the planet and bringing the carbon emissions down. We're using big data and AI, and we're doing more research in that area so that we've got good live streaming data going forward. And increasing the yields, making what I'd call an old industry in polytunnels and glass houses more efficient with technology is really important. And that's really where we come in with our product ranges, which I've gone over. So taking those yields from four to five a year to 18. We have a full turnkey solution to help growers if you're in vertical farms, polytunnels or glass houses.

24:19 And this is a worldwide solution that we are designing, developing and now selling. So just to summarize, that's where we are. It's a really exciting time. This is a beginning of a journey for LIGHT SCIENCE TECHNOLOGY. There's lots for us to go out. We've got good visibility going forward. So David Attenborough was at COP26, as you all heard in the news, and the new industrial revolution is powered by millions of sustainable innovation and essential and is indeed already beginning. We will all share the benefit of affordable clean energy, healthy air, and enough food to sustain us all. And I think that was a really good closing statement by sir David Attenborough, and I'd just like to mention that. So now we will go to any questions which have come up through the presentation. That ends the presentation, and we'll go through any questions that they those come up. That's great. Thank you indeed to Simon, Andrew and Jim for updating investors

25:23 this afternoon. And gentlemen, please do continue to submit your questions using the Q and A tab situated on the right hand corner of your screen. Just want management to take a few moments to review those investor questions submitted already. 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 Meet company dashboard. I'd also like to remind you that your feedback is important to the company. And immediately after this presentation has ended, we'll redirect you for the order that you can provide your thoughts and expectations to the company. Simon, obviously, we did receive a number of questions ahead of today's event. I know you've touched probably on some of them throughout the presentation. But before addressing the live Q and A, perhaps I could start off with a couple of the pre submitted questions. The first one reads as follows: Is the recent strong growth expected to continue? Absolutely. We've only just started our journey and raising the money that we did of £5,000,000 on the October 15 on AIM has given us the early advantage of really tackling and going forward to the next level for us. We're doing quotes globally now and starting to do projects, which is really exciting, as you see by the Zenith contract that we have started and broke ground to do, which was over 13,000,000. So you can see the size of them.

26:42 This is really just the start. There's a long way to go. And growing food and a growing population is something that is needs to be tackled now because, as Andrew alluded to earlier, we are running out of ground. We are running out of water. These are all important things. So being smarter about how we grow our food is the way forward. So, yes, there is huge opportunities for us. That's great. Fantastic. Jim, forgive me. I I admitted to to remind myself that you were gonna be hosting the q and a session, so I'm sure you're not gonna show me up and ask these questions far better I am. But just to remind you, could I just ask you just to make sure you got the q and a tab from the live questions? You'll see a number from John, Brian, Michael, so on and so forth. So if I hand back to you, and I'll kick up from you at the end. Thank you, Mark. So, yes, a question from Brian. What patent protection have you got? Okay.

27:36 We've got what we call a picket fence strategy. We have a retained IP attorney that specializes in this field. And what we've got what that means is we've got two core technologies. So we've got the luminaires that Simon alluded to where we take the insides of the the the point of differences, the that we take the insides of the LED and PC board be board out that nobody else can do. The other core technology is the sensor. It's the only all in one growing sensor. Most companies either do a lighting sensor for a lighting company or a nutrient delivery sensor for a nutrient company and so on. Nobody actually looks at all of them, but there are nine cardinals of a plant's life that

28:13 makes it grow. So, you know, we feel like we need to look at everything that's involved in in in that growing cycle. So what we'll do with the picket fence side of it comes in where we add incremental innovations to those core technologies. So it's like we surround them with more patents. So if your competitor is trying to get at our patents, you've not only got to navigate around seven or eight claims in the core technology. You've then got seven or eight in all of these incremental ones, and you start to add those together. It's a bit like how they do it in mobile phones. You've got 70 or thousand patents in a an in an iPhone. You know? So you'd have to be crazy to do a competitive product around that. And now we promise we're not gonna do 70,000 patents, but, you know, that's the general idea. We kinda surround ourselves with that sort of level of protection. K. We've got another question. In your prospectus, you talked about using crop using AI software to help clients grow their crops better.

29:08 Please, could you talk to us about this?

29:10 How quickly do you think they'll be able to develop and roll out this software technology? What we've got here is we've we've been working with the Innovate UK grant that Simon spoke about earlier was that's nearly two years old. We've been working on that for the past two years. And part of that is we've got a data scientist that has been literally creating the machine learning for that period of time, just keeps recreating off the data lots and lots of data. And what that does is eventually teaches the AI to make decisions. But we've created a what's called an MVP of minimum viable product. So we look at the largest market segments. We've done extensive surveys of growers that looks at what elements they want to sensor and measure, and then we've cross matched those with the market and then looked internally at the technical resolution for those, which we've already prototyped.

30:05 That's been that sensor's already been running in the lab now for sort of six months or so. So the minimum amount of development that's required to hit the biggest market first. So the rollout of the all nine cardinals with AI and everything else like that is expected take around two years, but we're expected to be selling sensors in anger in the first half of next year, and we're already well into the development process of that. Thank you, Andrew. Could you explain about your sales methods? Are you finding that customers are searching you out? Are you pitching for sales opportunities?

30:39 Or a combination of both, what do you think is the future sales mix from WINGS to come through in the future? Future. Yeah. So from a sales point of view and sales and marketing point of view, we've got a really good strong team. And obviously, we split it up into three key sectors, as you can see, which is vertical farms, and Andrew mentioned that they are can be lumpy in their nature. And the reason vertical farms are lumpy in their nature is that they've got a lot more resources required, large amounts of funding is required, finding the right site to put them on and getting the right power to site is crucially important. And all of those take time. When they do come through, they are enlarged in nature because they're very big buildings that they're going into as an enclosed environment.

31:31 So on one side of the business, we're looking at that, and we're building on those vertical farms, which we've got quite a number in that pipeline I mentioned of just over £40,000,000. But on the other side, the historic industry, if you like, glass houses and polytunnels, they've been going over a hundred years in growing in that environment. So putting technology in, if it's just lamp replacements that people are requiring from our customers or if that's actually putting sensors in, we found that a lot of people are moving now, our customers are moving in bringing in technology. So the industry is starting to change and turn because they've realized that they can grow more

32:17 yields. And that might start with growing from four yields a year up to eight. And then as they put more technology and put more investment in as they see the repayment of that technology coming, then they start getting those larger yield returns of 15 to 18 yields. So we are globally doing quotes, but also choosing those three key areas to take the lumpiness out of our business. And we see a lot of opportunity, as I mentioned earlier, in a GBP 20,000,000,000 market. Yes. We've had a number of questions around this. How exposed is the business to global component supply chain constraints? What mitigations have been put in place? Okay.

33:03 There's two sides to this. There's a light science technology side, the horticulture side, and then there's The UK circuits up in Manchester, and they're very different. So the light science technology side, we're a bit like a pub. We're a fruit like a free house where we we're not tied to any one LED manufacturer. So we can use the best LED for the project, depending on what they're trying to achieve, which means we're not kinda tied to particular people like some of our competitors like your Philips and your GEs where they're doing a lot of stuff in house. So that allows us

33:33 to go as well where there's supply. So we haven't really experienced those issues on the LST side of things. On the UKC side of things, yes, that's an had a massive impact, but, actually, it's turned into a positive because what we've had there is lots of forward orders placed to secure the supply chain. So and what we've just recently done is we've actually employed a technical buyer from Hong Kong. He's based now in Manchester. And what his role is, we've been quite adept at this, and we've won quite a bit of business from other people. So if you've got a shortage of a capacitor, you could get a call to say it's now gone to a one and a half year lead time. So we will then find an alternative component and cross check that component with all the other components in the project to make sure there'll be no conflicts or anything like that.

34:20 But this so we're using this technical buyer to do that to help make those decisions, but, also, it enables us to go one down the food chain. So, obviously, we're buying capacities and things like that from the Far East, but he he enables us because of his network to go one down the food chain. So I think if you're Ford Motor Company and you want millions and millions of an item and we're there wanting 50,000, we can nip under their legs and we can normally get them. So we've been quite good at that, but that move is to make us even better at it. And that's you know, that that has been a real big driver of forward orders, which is fantastic. And, you know, we're getting lots of opportunities, but it's a lot of hard work as well. Who are your key competitors? How big are they in comparison to you? So the industry started in the lighting side about nine years ago with GE, Philips, OSRAM, the big boys, and they came into it, you know, you when you think fluorescence lights are gonna die a death, you've got to sell something else. So you've got to find other markets.

35:21 But LEDs last three, four, five times longer than fluorescence do, so therefore, they need to find other markets to sell more to. So they came into this sector unashamedly to sell more lights, basically. And I think you've got OSRAM that have bought Fluence. So they would be one of our biggest competitors, and they have moved a little bit more towards the sensing side, but only on lighting, not in any other of the plan cardinals. Philips haven't really made that sort of move. And g, all they do really is they use their lighting control systems that use in an office. So the big boys are, yeah, absolutely huge compared to us, but they are they have opened the market for us, and we're following behind. And, you know, one example is they'll sell you a straight line fit in certain meters, a certain size straight out of a catalog, a certain power output, and there'll be one driver per light.

36:12 We've just got a project where we're we're looking at a project in final stages where we've got we've been able to run five lights through one driver, make the lights a specific length in no more lead time than anybody else. And these are vast quantities,

36:27 which means it it fits nicely on their racking system. It doesn't overhang like other people's do or need further bracketry to support it between the legs, and we save them 40% energy. So it's kind of you know, the quantities that we're talking about are big enough to kind of offer an element of despoteness. So we all say our lights are 80% bespoke 80% standard and 20% bespoke. So the standard bits are the extrusion commodity based items that we buy, cut to length, and assemble, and these this the 20% bespoke bit is tailoring that in the way that the lights will work and the the way that they infrastructure in the that in the farm will work. So Which plant species does this tech apply to? What is required to extend the applicability?

37:15 So which plant species does the tech apply to? Well, tech actually covers all of plant species. So that's the advantage compared to our competitors of having our own lab and our own scientists here. We can grow all sorts of things from strawberries, so we're working with one of the largest berry providers in the country with over £300,000,000 worth of revenue. We're working with them to grow strawberries all year round. We're working currently in the lab growing a certain species of plant, which is producing metal, believe it or not, really different tack, but that's producing metal. So all sorts of things that plants we can cover, and what we can do is we can prove our technology using the lab and grow the plants and do trials for individual growers and farmers before that they then go and test it in their own grounds to prove what it can do and what yields need to do.

38:23 Because it's really important to make sure that we're getting those nutrients right and there's no wastage as well going through. And that's what we're creating with that lab and having it here on-site with our own facility. We haven't got to send it off to a test lab, which takes three or four months. It's all here in on-site, working in partnership with our clients to get the best outcome for them. Do you see other opportunities for IP spin offs from the manufacturing division? If so, can you indicate what these might be? So, yes, we do. As you know, we're working with a sensor technology. That sensor technology will evolve over time to do various other things. But at the moment, we're focusing on plants and the environment.

39:16 But in the future, it will lead into more medical arena because the sensor technology on there can read blood types and bloods, which could obviously lead to a lot of key areas for us going forward in the medical arena. Of course, you've to be careful of what I say because it is new, and we are focusing on the controlled environment, agriculture at the moment, but the medical side will come out in the future going forward. Like this one from John. From the funding you've just raised by from the IPO, do you envisage that you may require more? If so, will you allow will sorry. Will you allow and make sure that small retail investors are given the opportunity for any future capital raise as we definitely like to support you?

40:07 I'll let you answer. You, Jim. We'll let you answer one of them. Well, thank you, John. Yes. Definitely. You know, we've got plans as very much Andrew and Simon's past the presentation have have covered and, you know, not least the med medical application that that Simon's just mentioned there, which is one for the future. It's not on the hot plate for the short to medium term, but it's very much one for the future. So So we've got growth aspirations both in terms of, you know, applications of our IP, but also in terms of geographical reach. So very much we're we're we're enjoying working with investors, public investors, and we we very much plan to continue to do that. How many people are employed in Dobby, and how many within each function?

40:57 Any challenges in recruiting? Yes. It is quite difficult in recruitment at the moment. I think people are not generally moving a great deal, but we have managed so far. We've got about 17 staff here at Derby, a couple of scientists. You know, you've got a few in the sales team. The marketing side, we tend to centralize across LST and UK circuits, so new business lead generation. What we want to do is for customers to know about us before we knock on the door. So we're doing that through an LST through white papers and thought pieces and things like that. So that's it. And up in UK circuits, we've got around 60 employees to to give you a flavor of how many people are up there. So the business as a whole is obviously well over 70 employees as a group. But we're just building a central development resource as well, which we'll use, and that will help with spin off products from The UK circuit side of things as well. So but there will be sort of electronic engineers and software engineers, so they were just about to embark on that recruitment drive, but they'll be based in lst.

42:03 In Derby. Do you have reference sites that can be reviewed by large clients with data for them to compare what yields they already have? We're just in the process of setting up one with the university where they will actually manage the site for us. And then the other thing that we're doing on the rolling cloche, we've agreed a deal with Zenith to be a dealership site for that one. So they will actually demonstrate the products actually working on that site. Could you talk us a little bit more, generally speaking, about your r and d strategy? Are you working with local universities or government catapults? Yes. We are working with a number of universities.

42:48 We're very fortunate here. We're literally twenty minutes from Sutton Bonnington campus, which is the University of Nottingham, and they're sort of plant science side of things. We're about fifty minutes from the Notting Trent University. We engage with Derby University. All the products, for example, on the luminaires, we've had them all thermally tested and stress tested to allow us to estimate these things like deflection and what will happen when you put LEDs inside sort of components that could melt potentially, also looking at the aging of them and things like that. So we've used Derby more on the engineering side, the two Nottingham universities for the sort of plant science side. We're working with Smart Park who are bigger a a big development going on in Derby at the moment. It's just about to start millions of square feet of manufacturing and food technology campus as well. So, yeah, lots lots of that. And we see that being that's the point of difference really between participants like ourselves than the big boys that are selling the lighting. You know, we're really trying to get ingrained with and work alongside farming rather than trying to attack attack it like some of other participants do.

43:58 Well, I think that covers the, the common threads of questions that we've received so far. Thanks very much from from everybody. So if I can hand back to you, Mark. That's great, Jim. Thank you very much, and thank you for sharing my questioning skills out out there to everybody. Well, look, thank you again, once again, guys, for your time, and thank you to all the investors that have submitted the questions today. And of course, if any further questions come in, we'll make those available for you guys to review post today's meeting. I know investor feedback is particularly relevant to you guys and important, and I'll shortly redirect investors to provide you with their thoughts and expectations. But I guess before doing so, if I may, Simon, if I could just hand back to you just for a few closing comments just to wrap up with, and then I'll send investors to give you their thoughts.

44:43 That's great. Thank you very much, Mark. I'd just like to say that we've on to the market. I noticed one of the questions that we missed, are we too young a company to go as a percentage of customers and retention? So one of the questions there is that we have got an established business here in UK Circuits, we mentioned earlier, delivering just under £7,000,000 worth of revenue and growing at 24% and cash generative, which is really important. And the spin off out of UK Circuits came LIGHT SCIENCE TECHNOLOGIES a good few years ago now. And from that, we've been doing sensor technology at UK Circuits for over twenty years and manufacturing lights for that matter for over twenty years.

45:32 And so when using that technology and the experience of the team and growing that experience to put it into to life science technology in a really exciting growing market. You know, the inquiries that we get, we are really excited about and the potential work coming through and the the forward order book that we've got of over £18,000,000. So that really puts us in a good position and visibility for 2022 and beyond. So I think we've got a really good and attractive investor proposition here, and we hope that you will come and join us on the journey. That's brilliant, Simon. Thank you for that. And thank you to Andrew and Jim for your time in updating investors. Could I please ask investors not to close this session as we'll now automatically redirect you for opportunity the to provide your feedback in order that the management team can better understand your views and expectations.

46:29 This will only take a few moments to complete, but I'm sure will be greatly valued by the company. On behalf of the management team of LIGHT SCIENCE TECHNOLOGIES HOLDINGS, we'd like to thank you for attending today's presentation. That concludes today's session. Good afternoon to you all. Thank you. Thank you very much.