Mirriad Advertising (LSE:MIRI) — Final results

0:01 Good afternoon, ladies and gentlemen, welcome to the MIRRIAD ADVERTISING PLC final results investor presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time using the Q and A tab situated on the right hand corner of your screen. Just please simply type in your questions at any time and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company can review all questions submitted today and publish responses where it's appropriate to do so. Before we begin, we would like to submit the following poll and I'm sure the company would be most grateful for your participation. I'd now like to hand over to Chairman, John Pearson. Good afternoon. Great. Thank you very much. Superb. Hello, everybody, and thank you for joining us. We've got a good number of people today. And we've got quite a lot to cover.

0:49 So today's presenting team, myself, our Chairman Stephen Baringer, CEO David Doran, CFO and we're joined by Mark Melding from New York, who's our EVP of The Americas. A lot has happened, tremendous amount in the last twelve months for MIRIAD in many areas of the business. We continue to commercialize our market leading in content advertising platform. So today, we're going to cover, obviously, the results, but more importantly, we're also going to report on progress. We feel the company has reached an important tipping point in many key areas this year. I've included some of these is newly introduced KPIs, which you may have seen. Importantly, we continue to move towards universal access to the advertising ecosystem through programmatic adoption, and we're going to feature on that today. Stefan is going to take you through where we are for that.

1:40 Let's just remind ourselves of the key investment case for MIRRIAD. Can we have the next slide, Stefan? Brilliant. Well, MIRRIAD retains its market leading position in this groundbreaking rapidly expanding sector. In content, advertising is not only opening up a new revenue stream for content producers, but welcomed also by viewers as a more relevant and focused advertising message. The TV and video ad market is worth a staggering $149,000,000,000 and is fragmenting really fast at the moment across platforms at a time when viewers themselves are becoming more and more resistant to linear advertising breaks. Our disruptive and patented technology is now accelerating in adoption by some of the world's biggest advertising brands, and we'll cover that today.

2:28 We're also seeing significant market adoption by supply side partners and content partners. Partners who are testing the platform and getting tremendous results from it. The U. S. Is the world's biggest advertising market. It's bigger than the next five markets added together. And therefore, we make no excuse for continuing to ramp up our sales effort in this key market, giving us accelerating returns as we continue to commercialize the platform. Thank you, John. And over to the next slide. So I will cover the grand part of the next section, but not alone. Fortunately, I will be joined by David, who will talk about the speak to the numbers, last year's results, and Mark Melvin, who has been introduced earlier, will basically explore and explain the momentum and the great progress we're making in The United States, and we wanted to make sure that you literally hear it also very directly firsthand in terms of what is going on in The United States.

3:30 So allow me just to take a step back here and reiterate why it is so important what we're doing here. And this has all to do with the issues and challenges marketeers are facing. That so the principles we've always spoken about haven't really changed. It's more the drama that is going up, and Mark will touch on that as well in terms of the growing fragmentation, especially in The U. S. Market, which is causing big, big headaches for advertisers. But if we wrap it up in a nutshell, three key issues are: number one, consumers are avoiding ads and they're going into streaming services, etcetera. And number two, the big issue that is looming next year is basically the disappearance of third party cookies.

4:16 So in other words, the ability to target audiences by behavior would just literally go away. And number three, which is an issue that has been burning for many, many years now, is literally this ad fatigue and the noise in the system that creates this situation where ultimately no consumer is really willing to pay any attention to advertising anymore and ideally to skip it away. So and what we see on the right here on this slide is that, number one, the stats, and these are North American research or industry data that basically show two curves that are very, very dramatic. Number one, the red one, which shows the investments in terms of billions of ad impressions that advertisers are buying on top of what they were buying before.

5:07 And the blue curve shows basically the incremental reach that they're gaining through these incremental buys, and the incremental reach is actually zero. So in other words, advertisers are spending more money, but they're not getting more results out of that, which is obviously a big, big issue. This issue gets even more dramatic when we think about or when we look at the stats on the right hand side, which basically says that 60% of those who are eventually even able to see the ad because they're stuck in front of the television don't pay any attention to it. So these two things taken together really declare the big issue for the industry in terms of overspending to reach results. And ultimately, for marketers, this represents a big issue because they need to grow in an effective manner.

6:00 So as you know, and you've seen this one before, our paradigm is completely different. We're flipping things on the head and basically saying, all right, we're staying away of this big noise, the 6% of the viewing time of television viewing time that are consumed by ads, where all this noise is happening, where all the money is flowing in. We're staying away of that, because nobody pays attention to this part. We're going into the untouched, the greenfield, which is the content itself, that's 94% in The UK, unspoiled by advertising and where the attention is extremely high and we know this, that there's a much huge preference in terms of in content advertising format over traditional formats.

6:45 And now if we translate this model into the how can I say, the commercial opportunity, and this was inspired by an American investor actually we spoke to and who has big holdings in a couple of major ad tech companies? And he asked me the questions, Stefan, how many avails, like ad opportunities, can you create per hour? And I said, well, it depends on the content. It's probably 10 to 20 avails per hour. And I said, this is absolutely amazing because it effectively means that you could be adding you guys at MIRRIAD could be adding 50% to the current volumes in the ad space because that is between twenty and thirty ads per hour. So if we think about it this way, the 149,000,000,000 that are being spent in television and video advertising every year, which is our TAM in the key global markets broken down in The U. S. 80,000,000,000.

7:40 Let's just think about half of that really being in reach for in content advertising. So that then is the side from the how can I say it, from the content industry standpoint, the television broadcasters, etcetera, a new revenue stream that could really, really fill their revenue buckets? And on the other side is basically the impact that we can create for the advertiser. And here, early February, we have the how can I say, the industry official industry data from Nielsen and Barb in The UK, so Nielsen U? S. And Barb in The UK, where we are now able to compare program ratings, so basically the reach of programs versus the reach of the ad breaks that are running in between the programs or within the programs. And on average, and this is the average number, we can reach with 23% more people. Again, 23% more people. And that does mean that effectively, if you look at it the other way, if a marketeer does not use in in content to reach the audience, they're missing out basically on a grand part of the audience that they could reach.

8:52 I've said averages because we have seen the results and we can expose them. Actually, we released a white paper very recently where you can see that in The UK, for instance, I think we topped the reach by 39%, right, compared to the adjacent ad break. In other words, in content advertising is able to reach way more people than traditional advertising does. Now, and this is not just a phenomenon for television. We will see that in the world of advertising supported VOD, which even Netflix now have announced that they will probably go into that space, The same issues of people going to the fridge or looking at their phones or doing something else when the ad runs will occur in the same space, in the same level of problems. So basically having in content as the solution to mitigate that issue will be absolutely key.

9:46 So that's the quantitative side. We can reach more people and of those that we reach, so the ones ads don't reach and the ones that ads reach, we have you know, across the board much, much better results. And these are the stats on the right hand side, and they keep getting better and better and better. We can lift with in content ad awareness, we can lift the brand affinity, the purchase intent, which obviously from a commercial standpoint is absolutely key, and then the consumption itself. So these numbers are absolutely staggering. And both components taken together now, and that is a game changing moment for us since early February that media procurement people on the client side and on the agency side are looking especially on the left in terms of, wow, for the same dollar, for the same pound, we can reach more people and that definitely delivers more value to the media investment. And that is a huge argument now that Mark, I think you will touch on when we talk about United States in terms of the impact that is starting to have on our conversations with clients and agencies.

10:50 At this point then, I'll hand over to you, David, to briefly summarize the results of last year and then I'll come back together with Mark to talk about the progress we're making. Thanks very much Stephane. So on this slide we've summarized all the key metrics across the business. On the revenue side we're broadly flat year on year but this masks a significant shift towards The US. So in twenty twenty fourteen percent of the revenues came from The US. By 2021 this was up to 44% and we expect this trend to continue as revenue from The US increases and we move away from guaranteed historic revenues in China. In terms of operating loss, this has increased as we ramp investment into sales account management and business development. We're doing this particularly to maintain momentum in The US.

11:39 We've also continued to invest into our technology function. Administrative costs therefore increased by 24% year on year and of this around 88% was staff related spend. Around half of that increase was into sales and sales related activities, a quarter into technology and around 20% related to non cash share based compensation charges. The loss for the year differs from the operating loss due to the inclusion of around million pounds of R and D tax credits relating to 2019, 2020 and 2021. And then just looking at the balance sheet, cash consumption broadly followed the P and L. Net cash at the year end was £24,500,000 and the loss per share was flat year on year. Handing back to you, Stefan. Thank you, David.

12:27 Okay, let's dive into the strategy and the progress against the strategy. So let's spend a few minutes on this one. On the left, what you see is how we're positioning MIRRIAD and how we're declaring our ambition, which is nothing less than enabling the in content advertising marketplace. So that puts us at the center between the supply side, namely the content owners, the content producers and distributors, and the buyers, which is the big advertisers or small advertisers and their agencies. And we're basically facilitating this marketplace by the creation of the in content advertising inventory that we do after ingestion and the process, and ultimately then delivering the data that allow the sales of that inventory into the market. And we do this not only on television. We have declared a while ago our ambition going way beyond that because and Mark again will touch on that a bit later advertisers' ultimate interest is to reach audiences. And they don't really care whether or not this is across Netflix, music videos, influencer content, television, whatever. They will always pick and choose whatever is most relevant, most appropriate and most effective for them.

13:49 And not bringing in music or influencer content would have been actually a real mistake, because as we all know, these are the contents, these are sort of the influential channels that especially young adults are consuming every day in a large quantity. So basically, our spin into the full game and the full canvas of content is absolutely right, and there's obviously much, much more to come in the future. So that's really the declaration of our market position, how we see the opportunity and where we stand today, frankly speaking. On the right, you see the strategy, nothing absolutely nothing new to that, but I'll just reiterate the strategy, which is mainly about three steps.

14:36 Number one, all about adoption, which is getting the market going and you know how this works. In other words, creating the supply, convincing content companies to unleash or to give us the permission to create inventory in content. And with that inventory, we go to the buy side. In other words, the advertisers and the agencies would then start booking campaigns. And what used to be really a very, very difficult circle is really turning into an upward spiral, and we've done tons of work in 2021 to get us really into the pole position from that standpoint. But there's a second effect of building this adoption into greater heights, which is creating relevance for the marketplace in terms of the buying and ad distribution ecosystem, and here especially the world of ad tech.

15:29 Because without having a stature in the market, without having hundreds of campaigns and big advertisers in the backing, it's very difficult to entertain or start conversations with the industry and to discuss how to integrate in the buying ecosystem. And this integration is really the step two, because once we are integrated and once we have the inventory listed in the buying platforms, then basically scale is almost a logical consequence, because the buyers will see the inventory pop up in the buying systems and basically we are one mouse click away. So it's really step one adoption, getting us into the position to enter phase two or step two, which is all about the integration in the media buying and distribution ecosystem, and from there really driving towards scale and ultimately becoming what we've always said our ambition is a line item on media plans and media buys of advertisers.

16:26 This all takes me into the world of programmatic, and allow me to talk a bit about that for a few minutes. So, as you know, media is all digital media is bought programmatically through digital pipes, and we're seeing that through connected television and so forth. Ultimately, it's also involving television more and more. So entering that space and being integrated in that space is absolutely key for us, because this is where the big volumes of buyers go through. And ultimately, it will, once we integrate in the big buying platform, and we've just called out a few names here such as Google DB360 or The Trade Desk, Amobi and other DSPs, again, there's going to be a greater ease of buying and basically uncutted inventory will be ubiquitous and accessible from everywhere.

17:18 And the way to look at this is really, I like this one analogy that we have an incredibly strong product, as you've seen before. And our job is to get this product onto the shelves of supermarkets. And now I'm comparing the DSPs with the supermarkets. Our job is not to reinvent Tesco, Sainsbury and Waitrose. That's not our job. So now you understand, hopefully, that our full focus is really on getting into the distribution through these big platforms. What happens also for the advertiser side is that we have then, because we will be aligning on the format standpoint, taxonomies and so forth and so forth, and really creating transparency across audiences also so that, as I've always said also, we want to be one mouse click away from any other digital buy.

18:07 And ultimately, talking scale, once this system gets going and we get more and more distribution in the buying platforms, as I said, scale will become an automated consequence of that position, of that integration, which will eventually have an impact on our revenue that is eventually unimaginable today in the positive sense. The second pivot beyond the programmatic integration is really The U. S. So we started transitioning, I should say, our efforts more into The U. S. Since 2020. I mean, we built the team in 2019, small team and really started attacking the market in 2020. And the reason to do that is very simple. Number one, and John has mentioned this, The U. S. Market in terms of how much is being spent in The United States Of America or North America compared to the next five markets, it's way beyond that. So you see the forecast for 2024 are $378,000,000,000 compared to $2.34 for the next five markets taken together.

19:15 So that's a reason number one, so the market is much richer, there's so much more opportunity to succeed. Secondly, all the big content companies sit in The US and you can see on the right the spend that goes into content from these companies. Obviously they need to recoup these investments and that's not done only as we've seen a few days ago through subscriptions. Netflix has clearly declared now that they have to go into the world of advertising to basically monetize and be a successful company from a commercial standpoint. So then on the bottom, you see other factors, which is, you know, ad tech happens and starts and ends in The United States. So that's where programmatic starts.

20:02 So all the big ad tech companies are based in The US. Global streaming market is led off The US, and basically all new ad solutions I'm aware of have always been invented in The United States. So that's definitely where we need to be to be a successful new market market leader. So now let's talk about the progress that we're making on the supply side. And John and David have mentioned the new KPIs. So last year, obviously, we were impacted by COVID. And I'll just say, as a company, we held up very strongly. We're always a Zoom company. It has created, though, a little bit of difficulties in new business, right? So it's better to be face to face to develop new relationships and trust than just doing it by Zoom. So that definitely has slowed us down a bit.

20:49 But nevertheless, we grew our footprint in terms of content partners that work with us and have said, yes, we want to participate in this new revenue opportunity of in content advertising. So you can see for yourselves active supply partnerships, in other words, supply partnerships that we have activated went up by 56%, which is a very strong number. But the underlying number of plus 64% of partners that we are allowed to represent or basically we can work with has gone up very steeply as well, and that is kind of the underlying sort of big wave that is building as we look into 'twenty two and beyond, and then counting, I should say, because obviously we're growing the footprint on a daily basis. Then another key KPI, of course, is the numbers of seconds, sellable seconds, which is ultimately from a buyer standpoint, that's the inventory that is buyable and that's going up very, very steeply as well, and not only from a quality standpoint, also from a quantity standpoint.

21:51 I did mention we expanded into music and influencer content. That was a very, very smart move because many advertisers love it, especially those who need to basically engage with young audiences. And with regards to Tencent, introduction of the CPM model, we've spoken about that last year a little bit. That's definitely a game changing model that also paves the path PLC, into programmatic. I'll talk about that later. And as we said last year also and announced not so long ago, the partnership with SpringServe, so the integration with an which is basically the first step into the world of programmatic, but there's obviously much, much more to come, and I will talk about that in a few. So that being said, Mark, if you could please shed some light and give a paint of where we are in The United States, what happened last year and how you see the progress and the momentum that we're making.

22:48 Absolutely. Thanks, Stephane. So yeah, 2021 was a massive step change for us in The US. The growth in our content supply has been tremendous. As you can see by the chart here, we've added new verticals which are critical because this is giving us the ability to better package our inventory to marketers. Marketers and that's enabling us to better answer their briefs and their needs and then be able to sell in more deals. So it's really helping us reach more consumer segments that are important to them. We've opened up more content from our existing partners. We've seen this as an ongoing trend as we sign a partner, they start to, you know, unlock some titles. But then as we get into the cadence, as we start to show success, they open up more inventory, they open up more of their channels, they open up more of their verticals and platforms and that's helping us to create a larger supply that again is meeting those advertisers demands.

23:46 From, you know, influencer music, as Stefan mentioned, it's really helping us to bring in younger audiences that just do not tune into traditional media formats anymore. So we've had quick success in both of these categories and are seeing advertisers come in and support them, you know, right as we've been able to light them up. So that's been exciting. New partners are continuing to sign. We've seen our partners' competitors come to us as they're hearing about the success we're having. So that's a new phenomenon where, you know, people were not calling us in the past but now that they're seeing success in the marketplace, they're hearing brands reach out to them to ask for this capability that's really fueling continued success across the marketplace.

24:33 We've also expanded into Canada which is another great and strong marketplace. We had really quick success there running campaigns. So that's shown really strong promise and you know the growth in supply is really back to the fact that we are proving that there's a massive demand out there from brands. And this is brand new, net new revenue from these network partners that they can't tap into without us. One thing I'd like to add Mark, right, is especially when you look at Hallmark and other partners through the work, we start with one show, two shows, three shows, but basically the expansion then once we successfully deliver these campaigns goes quite fast and rapidly. So Hallmark, think, is one of key partners who are really opening massive amounts of inventory, but many other partners as well because they're just seeing the success we deliver.

25:25 So now let's flip the coin and go to the other side, the buyers. So we've invested quite a bit into our sales power. So we added one senior resource in The United States. We engaged an outside sales company and added two more junior resources, Mark, in The U. S. We added a CRO international. So we made a lot of investment basically to really build this big wave post pandemic because, obviously, in the first half of the year, it was a really, really difficult environment, not only for us, but definitely for us as well. One key strategic move that we're making is really going more partnerships with agencies. And I've always said that agencies are the gatekeepers strategically from a budgetary standpoint, and ultimately agencies are our partners. So we're really intensifying the work there. We always have said that agencies are number one from partnership standpoint, so place we need to be. They will also be the companies the agencies will be the ones who will be optimizing on context, just to go into that detail. So they have a very vested interest to deliver better solutions to their clients. And that's why we're really intensifying that. And on a commercial level, of course, the deeper our relationships are and the more partner agreements we have, the more scale we'll get from that side

26:56 as well. So that explains that. But going into the KPIs, as you see, the active relationships are going up despite the softness of the first half of last year due to the pandemic. So that's great. We can see that the number of advertisers running campaigns is going up very steeply. Within that is hitting the number of also recurring clients that is going up as well very nicely, which is something we are very focused on just to make sure that we deliver successful campaigns. And then these clients repeat the business and then eventually sign a contract with us in terms of some innovation and research and what have you not. Beyond The U. S, and Mark will talk about that in a second, we did really big campaigns now also in Germany, which was sort of a watershed moment, and we're gaining momentum in Germany due to that as well.

27:49 And as you've seen on Channel four, I think it was really was actually the first campaign we ran with Channel four. We had signed the contract quite some time ago with Right Move, which was a wild success and certainly will have an impact on the success this year. So very positive developments there. We're working with top notch brands. So really, I just want to reemphasize that, that not only the agencies we work with and have active relationships with, but also the brands that's starting to become the who is who. We're working with the industry leading advertisers across literally all categories. We don't have all of them, of course, working towards that, but this reads really like a big who is who. That being said though, I'll hand over to you Mark because you are at the front of the action.

28:39 Yeah. No, great. I mean you hit a lot of key points. But the key is that you know with the growing supply, with the diversity of content that's available, again we're able to package better, we're able to speak to more and more brands to be able to you know make sure that those audiences that they're trying to reach that we can get there and we can get into the content and you know gain the attention of the viewers in a whole new way that they really can't get from other ad formats. So with that, we have signed you know many, many blue chip advertisers. These are the leaders in their categories. Their competitors are paying attention. They are seeing these campaigns. They're seeing their results and you know they're starting to engage. And again as I said before, they're engaging with our content partners as well. So we're seeing you know demand being driven through the supply partners back to us as well as our own outreach. So it's really creating mass scale and cycle of transactions.

29:38 So we wrote our largest number of deals last year with 21. They crossed you know all major key advertising categories from auto to CPG, food and beverage, telco, fin serve and we're seeing these clients come back and that's the proof of success. The research we've been able to field, the successful proof that they're reaching more audience inside the programming, these are all the proof points that are really driving and fueling the market. So this is expanded into you know new relationships that cover every major agency and holding company. So we're really penetrating them and as Stephane mentioned, these are critical roles or critical partnerships to be able to scale this business and be able to you know really operationalize the transactions and become that line item that is what we're working toward. We also signed our first framework agreement deal with one of the world's largest food and beverage companies.

30:33 That's been a major success for us. This is really a market maker and you know, we've done a lot of research there and had, you know, a lot of success rolling out new platforms and new campaigns with them and that's you know resonating across their agency as well. So all of this success led to revenue increase of 180% last year. Much of that came in the second half of the year after you know budgets started coming back after you know downturn in 2020. So that's just you know we're seeing that momentum continue. This all led into the holiday season which was a huge success. You heard from Chris from Hallmark. This is a marquee time of year for them. They're one of the premier programmers during this time of year as well as Lifetime and other partners of ours that we signed last year. We wrote seven deals and that's you know only going to continue to increase and you know this is really a very highly coveted time of year. It's one of those major tent poles and it goes back to how we package programming. We're able to do this now across many seasonal events throughout the year and it's getting clients to react and engage and invest.

31:44 Thank you, Mark. Okay, so now when we talk about technology, the platform and how we're basically accelerating towards scale through the platform, two things really that are very noticeable and notable. Number one is something that we introduced with Tencent on the basis of the new contract, and when you think about Tencent and the evolution of our relationship, in the past we were basically taking to market the inventory on a show by show basis, right? There would be a series and then these opportunities in the series were taken to advertisers and then booking came.

32:30 Obviously very exposed to, how can I say, postponements of shows, etcetera, etcetera, and not really because it's very cherry picking, not really recipe for scale? The new model is completely different, and it's based on basically the approach of giving advertisers the possibility to buy campaigns based on the audience that they want to reach. So an advertiser comes in or the agency and or the agency and basically say we would like to have a campaign in October, we want to reach eighteen-twenty four year old people in urban areas, and we want to have 200,000,000 impressions. So now what happens is that we execute that campaign for Tencent across the entire content universe that is relevant, and that's what we now have access to is basically not only the new series and shows that come out and allow for cherry picking, but basically the full content universe. So just think about it, look at Netflix or Amazon and basically the entire content that is on that platform. And as you know, Tencent is a very, very big streaming company.

33:37 And basically, we access that and now we distribute the campaign or we place the brands and products across hundreds of scenes. And it's not just hundreds, but basically, we are running campaigns now for clients where we distribute the insertions across 1,500, 1,600 different scenes, okay, just to give you a sense of the scale. And this is very important to understand that our platform now has the ability to execute at that scale, because that is one of the prerequisites as we go into the world of programmatic, where eventually we will have the opportunity to sell the inventory to many different clients, same content to many different clients. So we need to be prepared to really scale up very, very quickly and to basically do these insertions at levels that we'd never seen before.

34:27 The platform is now developed for that purpose. The second thing that we did last year, which is the other key pivot into the world of programmatic, is really the initiation of dynamic ad insertion. In other words, Mark, the result is that Mark and I could be watching the same stream and he would see a scene, as you see here illustrated in this little visual, he eventually would see it with a Geico ad and I would see it with a Pepsi ad. We're seeing the same. It's the same content. It's just modified differently for Mark, or that's at least how it appears to him. The secret is that we have integrated with an ad serving company, SpringServe, in The US last year already. That is basically now sort of the starting point for our path into programmatic, because programmatic buys happen on an audience base or geographical base or whatever, but they are all targeted. And that's why we need to have the capability to deliver it in a targeted manner. Now that is a big, big moment.

35:33 So it's not a small step for the world and a big step for us. It's actually a big step for the world and a big step for us. Outlook, what are the things we're working on? What are the things we're expecting? So certainly, number one and foremost, and that's really also what I've been working towards over the last two and a half, three years, is really to start getting ourselves integrated into the programmatic ecosystem, because as I said earlier, that is now the pivot into scale. So we're transcending the, let me call it, the technology supported and data supported era and going into the era of actually full automation of buy, sell and delivery, and that is the moment where we will start scaling in a completely different manner. So finally, we're at that point.

36:24 Stay tuned on that channel, I should say, because there's a lot going on and hear you very soon a few things in terms of news. Secondly, very important, we've spoken about that, is really creating the in content advertising format as a standard. So bringing that as a standard to the market and the Nielsen data really help us to that extent. There's more to it, but the Nielsen data help us really solidify our position as a solution in the marketplace that is actually really able to deliver return on advertising in a better way or as complemented with other buys, really augment the power of every invested dollar. So that is very important second lane.

37:11 Thirdly, we continue investing in tech sales and BD. The team you've seen, we've just announced also a hire in the content space, West Coast space and someone who's leading programmatic. So all these investments are going in that lane. We're really building out our position. We are the number one, but we're building it further out with blue chip advertisers, partners across the full ecosystem and so forth. We continue building The U. S. Momentum. We have really great acceleration there. Markus mentioned it, I mentioned it. We're very focused on recurring revenue, bringing back these clients that have successful campaigns and really creating these cases and ultimately delivering results to them. Then on the board level, there's some imminent announcements in terms of enhancing our structure and skill set there. And ultimately, just as a bottom line, I would like to say, I mean, we've been building our position in the market to the forefront to being in the pole position as this market now becomes truly sort of a new big deal for everyone who's involved. Mark mentioned that we're getting so much more inbound now and we're literally becoming a key topic in content. Advertising is undeniably now and we are the ones who have pushed this forward is undeniably now a real strength and a real pillar in the world of advertising and it's not going away.

38:39 And with this programmatic enablement, as we introduce it, it will create the next big halo in the industry and basically signaling to the world, yes, in content advertising is sold programmatically. It's part of the future in media, full stop period, and we are the leaders of this, and that's what we've worked on for all these years. So this is my last slide, so I invite David Wright to manage the Q and A, Thank you very much for your attention and we're taking the questions now. That's great. Let me just jump in David, just before you go, just to remind investors that when the meeting is concluded, we'll be sending you a link so you can access a recording of the presentation along with a copy of the slides and the published Q and A. David, hopefully, can see on the right hand side, you've got a number of questions from investors throughout today's call, and there was one pre submitted, which I've added in there for you as well. So if I may hand back to you to ask you to read out the questions and obviously where appropriate give a response. That'd great.

39:38 Yeah, will do. Some of them are quite long so I may paraphrase. So the first question is around Amazon announcing virtual product placement and are we concerned about the fact that there was something also suggesting they were working with Disney? So I'll take that, Mark, please chime in of course. So the first thing is we're actually very happy that Amazon announced it, because as a fact what happened is that Mark and I probably got, I don't know, 10 phone calls on the same day, people saying to us, and we were actually had a meeting on the same day with a big ad tech company saying to us, they couldn't have done you a bigger favor. And the reason for that is obviously if Amazon, as one of the biggest advertising platforms on the planet, announces virtual product placement, that's how they call it, right, as basically a new weapon in their arsenal. What they've done is to level set everything and basically say, Okay, this is legit, right? We are now So we had credibility, of course, but this has given the whole topic a completely different dimension now.

40:47 When it regards to Disney, and I don't want to speak for Disney because eventually, I don't know, but from everything we know, I think there's nothing related to I don't know where this information comes from. We haven't actually seen it, that Amazon and Disney work together. I honestly personally don't think it's likely, because when you think about how fierce Disney and Amazon are eventually in terms of competitiveness, and we're talking about content, which is a very sensitive thing, so I find it hard to believe that Disney would have Amazon look into the content that is about to be released, if I'm making sense. Mark Stefan, it's John. I totally agree with you. I think we talked about this in the last few weeks. Amazon coming into this market will completely open up and legitimize in content advertising, and that is just great news for us because they won't give it away. They'll be using it as a they'll be using it as a competitive advantage for themselves.

41:50 And the phone calls that Stefan's referring to are are from other platforms and and broadcast platforms saying to us, you know, let let's let's talk about this with more intensity. So we see this as the answer to this question in general is Yeah. We see this as a really, really big news. Great news for us. Absolutely. I I echo that on the Amazon front coming out and and talking about it and bringing it, you know, to the main stage. And then related to Disney, yeah, that is that's not something we have seen publicly and it's certainly not part of any conversations I've had where, you know, they look to us as their partner and in fact Amazon announcing news, you know, gave them a little bit of a kick to do more and look at this space in a deeper way. So it's in fact doing exactly what we want it to, which is putting a spotlight on in content and incentivizing companies like Disney and others to engage in a new way.

42:54 I'm going to move to the next question which is what exactly does SpringServe do and are they incentivized to push our product? Yeah, I mean, what SpringServe do is they do the ad serving. So on the ad server, think of it this way, I need to paraphrase it really, is they basically control coming back to the example earlier, right? So Mark is going to see the Geico ad, and I'm going to see the Pepsi ad in the same piece of content. And that is being controlled on the ad server, right? So the ad server has instructions that say, if somebody sits in Westchester that's where you are today, right, Mark? Then please send the Geico ad. It makes no sense, of course. And if somebody sits in New York, please send the Pepsi ad. And that decision is really made on the ad server level.

43:46 And obviously, I've created a very banal example. It's way more sophisticated than that because it's about audiences, it's about day times, geos, etcetera, etcetera, as you've seen in the video. So that's what the ad server does and the ad server captures a fee which is transactional, just as well as CPM fee on the transaction. Okay, next question. The US is an exciting market. How big a part strategic partnerships play in our ability to roll out at scale? Mark, you want to go? I can go. Maybe go first. Yes. I would say they're important especially as we get started. You know, we've seen strategic partnerships both with brands direct and with agencies propel other, you know, propel business and to, you know, spread it out across those agency groups.

44:41 But, you know, as we look forward, we'll continue to strike more and more strategic partnerships to continue to grow. We can cut deals and do business without them, but they definitely help to incubate and you know, put incentives in place to do volume deals. So that's how we look at strategic partnerships. And as a follow on question, because this relates to The US. Seventeen hundred hours of US content doesn't sound that much. How many hours do we need to be taken seriously? That's a loaded question. We are being taken seriously, right? So if I just Just coming back to what Mark said earlier, so we have now Now, first of all, big is never big enough.

45:29 A lot is never a lot enough, right? So I would never say, oh, yeah, the story ends here. No. We obviously are aiming for much, much, much, much more content, for sure, because the more content we have, the more inventory we can create, the more we can sell, period. So but that's an ongoing effort. Again, Zach Wieder is now also sitting on the West Coast, and we're working on some very interesting opportunities there. So but ultimately, as Mark said earlier, we brought ourselves last year, for the first time ever, into this position where we were not selling anymore a tin of tomatoes, coming back to the supermarket analogy, a tin of tomatoes and here's one broccoli, which is very difficult when you think about it, right, to sell that to a cook.

46:16 But we now have real menus that we can sell, right? The ingredients for real menus. And as we speak today, there's campaigns starting to roll out that are targeting different industry verticals. So now we have content and inventory packages that are really aimed for the financial industry, right? That just went out. We have packages that go to food and beverages, packages to FMCG companies and so forth. So I think that is actually a good way to say, yes, we have a bench of content now that is strong enough to create these content packages that are relevant to these different industry verticals. And that is a novelty, right? We were not in that position in 2020.

47:02 This started literally in the second half of twenty twenty one. Another question, specific about Japan, can we report any further progress in Japan? Yes, Japan, happy to do that. I mean Japan is a market that does not move at, how can I say, at light speed, and it just plows ahead and everything works very cautiously, so whoever has worked in the Japanese market knows that? And so where we are today, obviously I'm not allowed to disclose things, but we had announced this first campaign with Fuji TV. The results were very, very on the back of that, there's this growing interest in the market, which sounds a bit fluffy, but it's actually not.

47:48 And we're pursuing the next opportunities with Fuji and others. So there's stuff to be expected coming from Japan. A question about our cash burn and runway, and when do we think we would need to undertake more funding? Do want me to take that one, Yes. Yes, we're still in loss. We intend to continue to execute a growth strategy, which is what we're doing. We had, at the turn of the year, 24,500,000, which would give us a roughly eighteen month runway. We would if we saw any way of accelerating growth, we would possibly come back to the market at that point. It's still something the board's considering at this point.

48:47 Question about how we monitor the quality of our ad insertions. Well, mean, there's different levels. One level clearly is the inbuilt. We have obviously a QA that checks everything, so that's the one thing. Then there's another part which ultimately involves the content owner and the brand and the agency. So there's kind of multiple layers of quality control. I think the one very, very important aspect in terms of the quality is really the results that we drive. And this is where we are absolutely outstanding and keeping up the levels or even getting better. So what I'm trying to say here is that the holy grail is always the viewing experience.

49:34 If the viewing experience is poor, then the result for the advertiser is poor, and ultimately the content owner and IP owner will not be very happy. So that's why maintaining these high levels where, as you've seen, 80%, 90% of people say, yes, it does make the content more compelling, we love the format, etcetera, etcetera, for us is really the holy grail. But there's obviously technical QAs before that, and then there's the contextual intelligence that just makes sure that an integration is not nonsense, but it actually makes a whole lot of sense emotionally and intellectually speaking. A question about how staffing levels will change as the volume of ad campaigns increases. Yeah, I mean, that's David, that's actually one for you also, but I No, seriously, at the front, not much.

50:30 In the back end, QA and so forth. And that's the staff that we're augmenting in India, right? Which obviously is a good thing because it's in India and we have access to a lot of talent and the cost base obviously is impacted so much. Yeah, I mean I would say here the gross margin and that's the bit that includes the staff in India who do the production is around 80% and we'd at least expect that to continue if not slightly improve over time. So, know, it's in there in terms of the margin calculation. I'm really aware of time, so I think I'll ask this one last question. If you had one wish to help speed your progress, what would it be? I don't know, just a time warped in terms of, yeah, just speed it up. I mean, that's the only thing, right? It just takes time. We've worked so hard to get to this one point, game changing point, pivotal point now, where we're really entering the programmatic phase.

51:35 And obviously, that's the game changing moment, and from then on, actually, things will accelerate. And so I shouldn't say what I've just said in terms of, yeah, let's give us a time walk. But basically, time actually has always been sort of the main, you know, if there's an obstacle, then it's actually time because it just takes time until you create you think about electric cars and the time Tesla has taken to basically build what they've built and emerge as the market leaders. It didn't happen overnight. There's a certain similarity here with us. But there comes a point where things just the gates, the flood gates open and then you're running. That's great. Thanks, That's great. Thank you very much indeed to all the investors for submitting their questions. And thank you to Stefan and the team obviously for taking the time to get the responses.

52:30 Any further questions that we do receive, obviously, we'll make those available to you post today's meeting. John, Stefan, I know that investor feedback is important to the company and I will shortly now redirect investors to provide you with their thoughts and expectations. Perhaps if I may hand back to one of you just for a few closing comments to wrap up with, after which, of course, I'll send investors so they can give you their feedback. Let Thanks. Me take that one. Are I think Stefan's last comment was great, this the thing about what's the one thing we would do. The integration into the advertising ecosystem through programmatic adoption, think, is the next thing for us. And what that will do, that will accelerate this business to the scale that I think all of us who've invested either the money or time or executive time to this I believe this market is huge and that scale is not far off. Please look out over the next period for announcements of a few very dramatic changes we have and partnerships we have coming up with that, I think, would be my last thing. Watch this space would be a good way to end this session. So thank you very much for everybody.

53:46 We appreciate your time very much. That's very kind. John, Stefan, Mark, David, thank you so much for your time this afternoon and for updating investors. Ladies and gentlemen, could I please ask you not to close the session as we'll now automatically redirect you for the opportunity to provide your feedback in order the management team can really better understand your views and expectations. 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 MIRRIAD ADVERTISING PLC, we'd like to thank you for attending today's presentation. That now concludes today's session and may I wish you all a very pleasant afternoon.