Nanoco Group (LSE:NANO) — Investor Presentation

0:01 Good morning, and welcome to the NANOCO GROUP PLC Investor Presentation. Simply type in your questions and press send. Due to the number of attendees, the company will not be addressing live questions in today's meeting. However, we'll review all questions submitted today and publish responses where it is appropriate to do so alongside the pre submitted questions. Before we begin, I would like to submit

0:32 the following poll. I would now like to hand you over to CEO, Brian Tenner. Good morning, sir. Thanks very much. Hello, everyone. My name is Brian Tenner. Welcome to those listening live this morning or who are listening afterwards on the website recording, which will be made available shortly. I'm joined today by Liam Gray, our CFO. And together, we will be presenting our interim results for the six months ended 01/31/2023. We'll be kicking things off on slide number three. So if you could advance to that, please. And with the highlights from the period and also the significant opportunities that we see for NANOCO going forward. Firstly, today we have final validation process underway for a number of commercial production materials and we expect production orders by the end of this calendar year, so by December 2023.

1:25 Secondly, we're up still operating in markets where there's significant forecast growth in both sensing and display. Thirdly, the litigation process that we've now completed validated the group's core IP and that core IP remains under the ownership of NANOCO. And last but by no means least, the litigation proceeds underpin the commercial business, which is really important today, particularly in a in a market environment that is very much risk off for small cap companies. So those are the highlights of of the period and shortly after the period end. So if we now turn to slide number four, where I have a reminder of the value opportunities that we see for NANOCO. Looking at the green bubble on the left, the last few years, our main focus has been on our sensing business.

2:17 We already are delivering service and product revenue from our sensing business, and we expect to see multiple material validations in this financial year. So before the end of July twenty three. That then is a precondition to and will lead on to actual commercial production orders, which as I've already said, we expect to see by the end of this calendar year, so by December 2023. So overall in sensing, we feel we've delivered some strong progress in the period. If I look at the pinkish bubble on the right hand side in display, we're seeing new interest in our materials, and we have the potential to deliver service income, product income, and also we still have further license further potential for licensing income.

3:03 We're seeing increased engagement with a number of display companies. And in one case, we actually have materials on test test with a major TV brand. We also have the opportunity going forward to leverage our now validated core IP into potential new licenses as the market penetration of QD devices grows and expands. And underpinning both of those market sectors, sensing and display, we still own our core underpinning IP, which is relevant to materials in both of those markets. For now I turn over the pages, couple of pages to slide six, just a quick reminder of the sensing markets, the problem that NANOCO's quantum dots actually solve for the sensing markets, and what's our differentiator here when it comes to the sensing markets.

3:57 So just a quick reminder of the problem. So today, there are many billions actually of silicon sensors out there in the market. But actually, silicon sensors have very poor efficiency when it comes to infrared. Either they don't absorb much of the data that's falling on them, or actually, once you go out to longer wavelengths, and there are good reasons to go to longer wavelengths, unenhanced silicon sensors are actually blind. They can't see anything. The longer wavelength infrared will just pass through the sensor undetected. Current sensors, because they're operating at shorter wavelengths closer to natural sunlight, also experience problems with interference from natural light. It's natural sunlight, particularly at the higher end of wavelengths, there is a significant amount of infrared in sunlight.

4:45 Current sensors are also impacted by atmospheric conditions. I think I gave an example in a previous presentation where I have an electric car and the sensors on that actually deactivated because they couldn't see through. It was very light fog. So that's again another problem with silicon sensors today. Because of some of those problems, typically the lasers that are then paired up with a silicon sensor have to be higher power. And in a static device, whether it's in a building or on a large device like a car, that might not be a big deal. But in a mobile device where battery power is a key attribute and the duration of of that battery is a key attribute of the device, then obviously, again, that represents a challenge for those devices.

5:30 And lastly, the a point that needs to be made is that the the effective alternative to a silicon based sensor that's available today is an in gas sensor. Those are incredibly expensive. Those can be up to, you know, $10,000 for one sensor, whereas a CMOS sensor could be in single digit, you know, $510 or possibly more expensive ones, maybe even up to a $100. But you can see that the quantum of difference in cost is enormous. And when you then take into account certain devices just couldn't afford the cost of an ingas sensor, then you'll see particularly for consumer electronics markets that a much cheaper alternative is a must if those sensors are going to be deployed.

6:19 So the question then is, well, why would you use nanomaterials or quantum dots? Well, quantum dots allow the sensor to see further into the infrared. So instead of just being limited to around 900 nanometers, you can go to 1,100, thirteen fifty, 1,500, 1,800, even up to 2,000 nanometers. That's important for a number of different reasons. As you go further out, you actually overcome issues by interference from sunlight. You also can deal with atmospheric conditions because longer wavelength light literally not just passes through atmospheric conditions, but can actually go through solid objects as well. If you've got the ability to to see through these things, you can actually use a lower powered laser operating at those longer wavelengths, and again, that lower powered laser as a direct benefit for the battery needs or the battery life of a mobile device.

7:13 And lastly, as I've already alluded to, particularly when it comes to consumer electronics, you can't it's hard to imagine a telephone that would that's expensive enough to be able to afford an ingas sensor at $10,000 or any other consumer electronic device. So because CMOS sensor enhanced with quantum dots can be, you know, over a 100 times cheaper than the ingas alternative, that's a pretty compelling reason to be using quantum dots in a CMOS sensor these days. In terms of what does NANOCO bring to the party then and our our differentiation, we've already proven in fully functioning devices over the last few years, including working with previous customers that the data capture efficiency instead of being 7% efficient, that can be go up towards 60% efficient.

8:04 So 10 times more data being captured. And if you think of sensors or environments where the abundance of data is really important, then that data capture efficiency is is huge or a huge positive impact on the performance of the sensor. And, again, many listeners will be aware that a number of years ago, we constructed a a full production facility capable of supporting hundreds of millions of devices. That was paid for as part of our contracts with The US customer, and when our collaboration with them was was halted because of a redesign of their device. And that factory, if you like, was any financial obligation was written off, and that factory is now fully owned by NANOCO and it's fully unencumbered.

8:54 NANOCO today offers a wide range of materials, so it's not just one material set. And that's important, again, because you get different performances out of different material sets where you can tune our material to multiple different wavelengths, again because different applications require different wavelengths of light. Excuse me. And that's why we refer to our technology as a platform technology because we can't be flexed into these different areas. And last but certainly by no means least, our IP, as I mentioned in the summary of our two main markets, actually underpins that platform technology, whether it's into those two main markets or, you know, in in the past, we've addressed other markets like lighting, horticulture, solar, etcetera, etcetera. I won't go through all the examples below, but again, you will see that there are a number of different areas, different applications for quantum dot enhanced sensors, whether that's in quality control and the ability to the sensor to see, you know, for example, the here, it's a bruised apple, which should be rejected from going into the supply chain. Equally, to be able to see through opaque containers to look at fill levels, etcetera, etcetera.

10:07 And there are a number of examples down there. But basically, the main message is that there's a significant range of potential applications, And those are high valued applications for whether it's near infrared or shortwave infrared sensors. If we go over the page to slide number seven, there's a short summary here or just an overview of the CMOS image sensor market. And the independent market research company, ULE, estimate that that market today force for sensors, not just for the the quantum dots, but for the for the sensors, is around $21,000,000,000 today, and that will grow to surpass $30,000,000,000 by 2030.

10:53 That growth in sensor numbers is expected to be driven by combination a of mobile, industrial, and automotive applications. But again, as I've mentioned, there's a whole range of other market applications all contributing to that growth. The technology changes that are forecast also support the drive for new materials because you need to be able to increase the speed and sensitivity of those sensors. So even if you're swapping one sensor out for another, the new sensor, you want it to be able to respond faster, to see further, to have higher sensitivity, to pick up more data, etcetera. And that's where our quantum dots come in because those quantum dots, basically, turbocharger significantly enhance the capability of that naked CMOS sensor.

11:43 I already mentioned a couple of times cost is a key driver, particularly in the high volume applications because they tend to be cheaper applications. So whether that's devices in the home, devices in a smart building, devices in logistics and industrial control systems. And again, the largest part of consumer electronics is obviously mobile devices where it's estimated there's around one and a half billion of those sold every year. So the summary there is within the overall growth in the CMOS image sensor market is that drive for sensors to achieve higher performance standards and that's where our NANOCO materials can play a key role. To then go over the page now looking at slide number eight, just a reminder back in 2008 when we first got into nano materials for for sensing applications, we effectively had one customer, one product, one application.

12:41 The chart below that on the bottom left shows that position as of the end of January twenty twenty three. We're currently active with around five customers across a multiple range of different materials and at different wavelengths. And again, you can see where I mentioned earlier that we're expecting to have two materials validated before the end of this financial year. That's the two orange dots you can see with the number one sitting inside them where we've made progress in this period. And again, you can see where we've made progress in other materials as high in in the last period as highlighted by those boxes with the dotted outlines. Just a reminder, these are relatively long development cycles. So something that's back at development could have a four to five year road ahead of it before it's ready for for commercial applications of production. And the best example of that is that the material that we started work on in early twenty eighteen, That's one of the materials that we're aiming to get into commercial production by the end of this calendar year. But if you look at it 2018 to the end of twenty twenty three, that's that five year development cycle, you know, as an example, a real life example that I was just talking about.

14:01 But again, just to summarize, our key goal for our sensing business, which is where we see our nearest term opportunities is by the end of this calendar year to have two fully validated materials and to actually have production orders for at least one of those materials. If we now go over the page, we're now moving to slide number 10 and give a little bit of background information on the QD display markets. And what you see on this chart is a forecast. It's a combination of forecast from TDR, which again is another independent market forecast and with some adjustments for for for company estimates based on a slight more up to date information.

14:48 Key thing to look at this chart is that the significant growth in the flat panel TV market is actually coming from QD enabled TVs. Their share of the market is forecast to rise from around 6% in 2022 to around 34% in by 2030. Key thing to look at is that the sort of purplish wedge in the middle, I. E. QD TVs that don't come from Samsung, that today is relatively small. I think we've explained in the past that Samsung for a number of years had market shares between 90100% of the QD TV market, certainly of the cadmium free TV QD TV market where NANOCO has focused our efforts.

15:37 You can see that the that purple wedge, if you like, of non Samsung QD TVs is expected to grow significantly over time. And if you like, that's where the opportunity lies for NANOCO, whether it's in the direct supply of materials to go into those TVs or potentially to leverage our now validated IP into potential licensing deals with participants in that market. It's worth noting that today, some of that known Samsung QDTV market is based on cadmium, and that is not a market in which NANOCO is participates or is active. And again, there's an expectation that over time that cadmium those cadmium QD TVs will actually be phased out and be replaced with cadmium free TVs.

16:34 So as I say, over time, you can see that expanding purple wedge of QD TVs that are coming from someone other than Samsung, and that's the the opportunity for NANOCO, whether through our production capability at Runcor or our validated IP to access value in that expanding purple wedge. If now I go over the page a little bit more background information on QD display markets. And here I'm talking about other devices compared to TVs. Now on the previous page, we we noted that, you know, they're around two fifty, 300,000,000 QD TVs over time. If you look here, the unit numbers are higher. However, the individual screen sizes of these devices are lower.

17:22 So in particular, where it says tablet, phablet, those effectively, that's looking at primarily at smartphones. So you can see that the individual sizes are lower. A typical 65 inch TV has the same area as around 70 or 80 average sized mobile phones. But the key message is that the more types of device are going to be adopting QD technology in their display. Inside each of the that growing number of devices, those devices themselves are going to experience significant growth within each type of device. And the main message is that while these are smaller devices in high numbers, they'll be equivalent to around a 30% addition to the tool area of QD TVs.

18:16 And basically, you know, bring it down to real basics. The bigger the display area, the more QDs that you need for that. Therefore, the bigger the opportunity for people who are involved in the production or licensing of cadmium free quantum dots for use in display devices. So that was some background information on QD display markets. And now just turning to slide number 12 and looking at the specific opportunities for NANOCO and our cabin free quantum dots.

18:48 Already mentioned that we're expecting significant growth forecast or there are significant growth forecasts for QDTVs with a compound annual growth rate through to 2030 of around 38%. The fact that we had our IP validated by the litigation process, that does create a significant technical and financial barrier to new entrants to to enter the market. I think I've already mentioned, we already have our cabin free quantum dots on test with a major TV brand. We have had that in the past, but the the last time would have been, you know, four or five years ago. So that's a nice step forward for us again. In retaining our Run Corn production facility, we have enough capacity capacity to deal with any new entrant coming into the QD TV market. And actually, most of the non Samsung participants in the CAD free TV market today, we could service those out to the Runcorn facility, which has the production capacity to service a few million TVs.

19:53 And if you consider that the entire cadmium free TV market today, excluding Samsung, is only around one to 2,000,000 TVs, You can see why we're saying we could actually support, you know, either a new entrant or or one of those participants. It's also the case that if we exceeded our capacity at Runcorn, there are two other options. One is that it would be a relatively low cost to scale our own production capacity if required, and also outsourced production is always always an option for us as we've had agreements in the past and still have some license agreements in place for outsourced production.

20:34 Last couple of points, ROHS, while the legislation to adopt that in Europe is still outstanding, the Europeans have accepted a new performance standard, which means cadmium based TVs will not be legal once that legislation is passed in Europe. However, it's worth noting an ROHS is a thing restriction of hazardous substances. Is a thing around the whole world. It's not just a European thing. There's ROHS in The United States and the different states. Each one has their their own legislation and also in, you know, countries as diverse as China, etcetera. It's worth noting though that a number of larger companies rather than waiting for our OHS to catch up and be legislated or enacted in various companies countries. Sorry. A number of countries or companies are actually pushing their ESG agendas forward by actually embracing carbon free solutions before they're obliged to through through regulation.

21:40 And the last point to make on here is we're currently exploring distribution agreement for our materials for quantum dots with a potential partner in Chinese in in China to be able to access that important market. So let's move over the page. I want to talk a little bit about the two IP transactions that they are contracts that the group signed shortly after the period end. As people are aware, we agreed to stay in the litigation before the period end, and the two final contracts were signed after the period end. What I said out here on page 14 is the financial impact of those two two transactions. So starting at the top, the total amount receivable under those two contracts is $150,000,000 growth.

22:33 The expected share from NANOCO of that is $90,000,000 on a pretax basis. The litigation funder and adviser costs total around $16,000,000. Now I need to say, or it's obvious that when you look at litigation finance after you've won, it looks expensive. When you look at well, that's 40% of the the the total proceeds that went to the funder and the adviser. So as I say, after you've won, it looks expensive. However, if you go back to before you started, back for us in February 2020, when the company had a couple of million pounds available to it in the bank, that was for running its organic business, etcetera.

23:20 When you're in that situation, can't even access the the legal system to seek redress for your IP infringement, etcetera, then that's why you look to litigation finance, which is, yeah, clearly accepted to be an expensive resource. But that's the approach that the company took and the reasons for it. Just to remind folks, we actually run an independent tender exercise for non recourse, meaning if you lose, you get nothing financing. So that rules out the vast majority of ordinary financing. Most people expect their money back. Litigation financers do not. And we received four independent offers of litigation finance from large litigation finance houses, both here in The UK and in The United States.

24:11 At the end of the independent tender process, we evaluated those four offers and we selected GLS Capital based in Chicago on the basis of, a, their superior commercial terms, and b, also the expertise and experience of their team. As you do want a litigation funder, he understands litigation, he understands the other side, understands tactics, etcetera, etcetera. It's not just about who can provide the cheapest money. And The last point I'd make here on that funder versus NANOCO share is that we actually, in retaining 60% of the gross award, that's higher than we previously anticipated where we've made a number of public statements saying we would expect to retain around half of the or at least half of the a a potential outcome that was towards the lower end of of possible outcomes.

25:08 Looking then at actual cash usage, tranche one was received in March 2023. The that was $75,000,000. The funder and advisers, their $60,000,000 has been paid out. Again, people have asked the question, why are they being paid out first? Well, if you're putting up 100% risk capital, you can understand why one of the negotiated terms in their contracts was they are the first to get paid, which does mean that if we had an outcome, say, of $30,000,000, they would get paid first, and $30,000,000 would have resulted in zero money for for NANOCO. That leaves then $15,000,000 on a pretax basis for the for the organic business. Obviously, NANOCO then has to service our our our tax and our organic business debt.

26:00 Looking at tranche two, the the next $75,000,000 that's due by February 2024, that is wholly unencumbered. All $75,000,000 of that, again, on a pretax basis will be for NANOCO. And at that time, in February 2024, the board will decide the best use of of those funds at that time, and we'll balance business needs with the already public commitment to make a material return of capital to shareholders, whether by share buyback or by in the form of of dividends. I think as well, we've also publicly disclosed because of the nature of our balance sheets and our accumulated losses and reserves positions in our subsidiaries, but also in the parent company.

26:47 At some point in in the coming months, we will need to get a high court approved scheme to do a capital reduction, eliminate some of our share premium so that actually when those proceeds are received, that we are in a position to then make that return of capital to shareholders. That's an administrative process. It's relatively quickly. It's relatively short process, and it will require a shareholder vote to approve that reduction in share capital or share premium in order to allow a return of capital to shareholders. If I then go over the page, slightly drier topic, but it is important to talk about the accounting for those two IP transactions.

27:34 So as previously announced, the two transactions were structured as a sale of IP and an IP license. It's fair to actually look at the the the two contracts together, but it is worth noting that the different performance obligations, if you like, in those two contracts have to be accounted for in a different way. I'll deal first with the sale of IP. As we previously announced, we retain full freedom to operate in all products, all markets, and all geographies. And that's as a result of two things. The two things being that we retain ownership of all patents linked to our current commercial activity and and the commercial activity foreseeable in the short term. We also have a license back on those patents that we actually sold, and this is an industry standard thing. And indeed, many of the terms and conditions of these agreements, sale agreement licenses, etcetera, are are are just industry standard. So we actually still have access and can operate the patents that that we've disposed of.

28:44 The patents that we sold, there was 118 out of a total of around 500 patents. Again, we've explained that those are non core patents, non material patents that had a book value of naught $400,000. And as I said, we do not believe that the sale of those patents in any way impacts our freedom to operate. The disposal, because it occurs at a point in time, will be recognized in financial year '23 as a profit on disposal of intangible assets, and there is an extensive non adjusting post balance sheet event disclosure note at the end of the detailed interim statements that sets out the numbers and figures around the the accounting that I'm describing in words here today.

29:38 So then turn to the IP license. The IP license has been granted over our remaining IP portfolio. And that's, say, the portfolio that still includes all of our core patents, including the two patents that we were going to to court on. The income there, rather than being recognized at a point of time, is expected to be recognized over the next nine years or so. And that's reflecting the fact that there is an ongoing access for Samsung to that IP portfolio. And that just then reflects the the requirements of IFRS 15, the accounting standard that deals with revenue recognition, because this is with the ongoing obligation to give Samsung access to that portfolio.

30:25 I should emphasize that doesn't does not include brand new technology. It's the the portfolio for the remainder of its average remaining life. Together, those two agreements are what led to the global settlement of all litigation between NANOCO and Samsung. It also leads to the end of the appeals that have been lodged against our IP, PTAB. And again, so that's part of the reinforcing of our core IP are being validated by PTAB. The last note just to point out here from an account an accounting point of view, these are estimates because there's quite a complex interaction between the patent box regime in The UK, which delivers an attractive 10% tax rate.

31:16 Also, The UK r and d tax credit regime and our position in that may change slightly. We're still participants in it. We still benefit from it, but we have to assess going forward whether or not we want to surrender our losses for cash. Because if you do that, we actually get a lower proportion of your your losses. And we also have accumulated UK losses at the end of January twenty twenty three amounting to £43,000,000. So in round sums, the final cash tax impact of the transactions is estimated to be around GBP 5,000,000 of cash tax payable over the next two years. And I'll speak just turning over the page to slide number 16. What I want to set out here is this is how the board, if you like, look at litigation risk and how we assessed a number of possible scenarios. There are more than this, but we set out four possible scenarios here that were considered by the board.

32:18 Because in assessing whether or not to settle a litigation without going to trial, That invariably involves a degree of compromise on your your your most favorable outcome because you're removing other risks from from the equation. If it just run through these quickly, then one scenario was to actually lose, go to trial, and the jury decide, no, we actually believe Samsung's story. And we don't think there was an infringement. We haven't put any percentages around these. People will have their own views. Some people think that the chance of losing was relatively low. Other people may have thought it was actually a much more meaningful number. But there is a genuine chance of losing if you're in front of a a jury. Also, if you lose on a jury actually finding factually there is no infringement, it's fair to say that you have virtually no chance of winning on appeal. It's possible that you could win on appeal, but you would need to start showing that the jury had reached an irrational verdict. And that's something that only happens very rarely.

33:22 So if you lose, you've got a very low chance of winning on appeal. Another scenario, which is from a net return to the NANOCO shareholders point of view, as bad as losing actually is if you win, but you win on the Samsung damages model. So here, the jury decide there has been infringement. Samsung have infringed your IP, but actually the jury are convinced of Samsung's damages arguments and model. So again, there, with the jury finding a fact and the jury deciding around you what the damages are, yes, you could you could appeal against the low damages. You obviously want to appeal the verdict as you want, but appealing against the damages, again, you may have relatively low chances of of success there.

34:08 If you then look at the bottom right hand corner on here, winning on our own low damages model. As again, as we explained multiple times over the last three years, one damages model would look at the component in the TV, one damages model extreme other end would look at the tool TV for value with a whole range of different ways of looking at damages in between. But it's fair to say that if you win on your own low damages model, you actually have you can't appeal. Because you can't appeal because you won, you can't pay your own damages model because it was your own damages model. So those are three of the outcomes. If you then look at the fourth outcome, possible outcome or fourth scenario, yes, you could win and you could win on your high damages model. We've made it clear, and I think we said in our annual report a number of times that our view was that if you won on the high damages model, the other side would be absolutely guaranteed to appeal.

35:01 You only need to look at the history of major awards and appeals and see how long they last. They can be four plus years because you could have retrials, you could have damages, retrials, retrials of retrials, etcetera, etcetera. You've also obviously got a risk of risk of losing on appeal, in which case the win becomes a loss. You've also got the risk if there is a damages retrial that you actually are back to then rearguing the damages models, which could take you back to winning on the other side's damages model, your low damages model, your high damages model again. Clearly, the longer that goes on, you then incur further very expensive litigation costs. And ultimately, you then get into the question of how is that going to be funded. And because it's not an open checkbook from any litigation finance provider, there is a budget.

35:50 It will eventually run out, and then you have to decide what to do thereafter. And again, you may find yourself back in the house. So it's further litigation finance or even more expensive litigation finance. So obviously, the board took extensive advice from different advisers throughout this process. But the summary looking at those different scenarios is there are actually three scenarios there. Given the fact that litigation finance and advisers get paid first, three of those scenarios would actually lead to an outcome of nil for NANOCO. With no obvious way forward or or or strong low risk way forward in dealing with that. The last scenario, the fourth scenario, irrespective what your view of those percentage chances is, clearly, it does have further risks associated with it.

36:41 You know, so in summary, any assessment of litigation litigation risk going into a jury trial, you're going to make adjustments for risk. If you decide to settle, you're going to compromise on some of the things that you're trying to achieve. And that's why we ended up deciding that in the best interest of the company, that gross settlement of $150,000,000 netting $90,000,000 for the organic business was the right thing to do. And ultimately, we saved one of the biggest, best resource companies in the world, and we netted more money or money that's greater in value than the company was when we actually started this litigation or just before we started this litigation.

37:28 If then go over the page and looking at future licensing opportunities, the USP tab validated our core patents, so that's a strength for us. We retain those core process and composition of matter patents. And those two things together without a growing wedge of if you remember the growing purple wedge of QD TVs that are coming from someone other than Samsung, that creates an opportunity for NANOCO for proactive licensing approaches as that market is growing. We've already established an internal IP licensing team that is identifying opportunities, and we've retained our IP strategy expert to advise us going forward. We're also in discussions with a couple of different companies about looking at options for external licensing support to support those efforts to leverage value from that IP portfolio that we we still have today.

38:26 The last point on this slide is just to to make the point clear that the proceeds from the IP sale and the license therefore allow us going forward to choose whether or not to if we have to litigate again, whether to use litigation finance or whether to self fund that. So the summary here is that with that asset still owned by the business, there is the potential in the in the medium term to create IP income to supplement the commercial business, which is the main focus of our management team and business activity. I'll hand you over to Liam now. Thank you, Brian, and good morning, everyone. We move on to the financial highlights slide, starting with our trading results. Revenue was up 45% on the same period in the prior year. This increase has been driven by an increase in the sale of materials by approximately 60% as part of the validation process, which all in all has increased revenue up to £1,600,000 in the six month period.

39:22 Our cost base remained stable. However, it's worth pointing out that some of the financial benefits from the closure of the Manchester facility in November 22 have been partially offset by inflationary cost increases. And in addition, we continue to invest in our premises and staff, where we have recently seen a 30% increase in headcount, which reflects the increased workload across the business. Cash to period end is £6,000,000 falling from £6,800,000 as reported at 07/31/2022. This is a net cash burn of just over £100,000 per month, and that includes the receipt of the R and D tax claim relating to the prior financial period. And still relating to cash, tranche one of the proceeds from the sale of the IP and the license agreements were received post period end in March 23. Moving on to the income statement slide, I'll just pull a few bits out.

40:08 As mentioned before, revenues of 45 percent and the increase in material sales has increased the cost of sales number from 0.1 to 0.3. As mentioned, the cost base remains fairly static, but we have seen some inflationary cost increases in both labor and operating costs, which means our adjusted EBITDA is in line with prior year. And as Brian mentioned on our tax regime, our tax position, we'll work with our taxifiers at year end to identify the most efficient use of our brought forward tax losses and our position in the Patent Box regime, given the profits which will result from the sale of IP and the license agreements. We then move on to the next slide. In the interest of time and with the intention to get to q and a, I'll just skip the next couple of slides, which should bridge our movements in net loss and movements in cash.

40:56 And this gets us to our financial summary. So for guidance, as we've previously mentioned, our full year revenue will be around 20% ahead of FY '22. This is before the impact of the Samson license agreement, which will contribute an additional 3,000,000 of license fee revenue. Our cost base remains at 400,000 per month, with the savings from the closure of the Manchester sites being partially offset by inflationary pressures and increase in headcount. On capabilities, we have managed to retain our core capabilities through three very challenging years. Our recent increase in headcounts will have a positive impact on our capacity to provide additional services and supply further materials as and when required. And we do continue to invest in both our run comp facilities. And finally, on treasury, we finished the pay with 6,000,000 of cash reflecting a net cash consumption of just over north of £1,000,000 per month.

41:46 The cash proceeds and the sale of IP and license agreements mean the cash runway is no longer a concern for the business. And finally, we're looking at restructuring our balance sheet to enable a potential return of capital in the future. And with that, I'll pass you back to Brian to summarize. So just running quickly through slide 25. And as Liam said, we've got over 30 pre submitted questions we want to get to. So there are folks can digest this at their leisure. But in terms of the opportunity, we're still active in some very high growth global markets, whether linked to display or sensing. Our validated IP creates barriers to entry and creates value leverage for us in display markets. And we have a wide range of novel high performing materials to exploit the expected rather rapid growth in sensing markets.

42:35 We refer to our technology as a platform in the business that we now think is sitting on a platform in terms of we're in the most robust financial and commercial position in our twenty year history. Our core IP underpins both display and sensing opportunities. And as I mentioned earlier, the the proceeds of the to of the litigation process means that the company has strengthened a fully funded risk off market. Lastly, in terms of value going forward, the litigation delivered the transformational value for NANOCO with our IP being validated by the process. We do have two materials, a final preproduction validation.

43:20 And management focus, as we said before, remains on our commercial business because that's the best way to deliver a sustainable long term increase or shareholder value in the long term. So that's it in terms of going through the presentation. I'll just quickly now turn to the pre submitted questions. We do have, as I say, more than 30 of them. We've been through them in advance because of that. And a number of them were duplicates. So where it's the same question or the same thing, we won't go through those. I'll read them out and respond appropriately. Question one, can you explain to investors in what way the company has been transformed by the Samsung settlement? And so when we started the litigation, the company was worth around £60,000,000 and three months later, actually it was worth less than £30,000,000.

44:09 At that time, the company was dependent on near annual fundraisers of around £3,000,000 just to avoid going concerns as you and the risk of becoming an IP shell. With our IP of questionable value having never been tested in litigation or having generated commercial production income. Contrast that with following the litigation process, our core IP has been tested and validated by the USP tab. We're now a fully funded business that can fund itself through the commercial production and should be seen as and should not be seen as a funding risk in a relatively hostile risk of market environment. Furthermore, we now have the opportunity to deliver further value from that validated IP portfolio. And obviously during these three years, while the litigation has been ongoing, we've made significant strides forward in our sensing business and other parts of our commercial business with significant reductions in our cost base, etcetera. So primarily, you've heard the reasons that the the litigation has transformed the business, but we've also made other transformational changes during the biz to the business during those three years.

45:17 Question two, with the company share price so low following the less than anticipated amount received in settlement from Samsung, why have our senior board members not shown confidence in the company and purchased shares with their own money? So collectively and individually, the board actually have good personal holdings in the NANOCO shares, and a number of us have significant additional holdings in options. It's also worth noting that all executive bonuses for the last four years, if they've been paid at all, have been paid in deferred shares and not cash. It's also worth noting that the whole board voluntarily reduced their salaries for a very extended period during COVID and actually remained then on reduced salaries for a very long period of time, even after all other staff, no other companies in the country were returning to full pay.

46:07 So we believe that the board has demonstrated significant commitment to NANOCO already. In order to ensure an orderly market, ensure no complaints of insider knowledge by any parties arose when NANOCO shares not suspended prior to the first RNS issued by the company on 01/06/2023, confirming discussions regarding a settlement were agreed with Samsung. Sorry. That that question is slightly convoluted. I was just reading it word for word. Simple answer to that is the company had no reasonable basis to expect a disorderly market in response to the short announcements on Friday January 6. That announcement simply said that a settlement term sheet had been agreed and we had thirty days to agree the detailed terms of a binding agreement, which included the negotiation of a number of high value items.

46:59 Question number four, why was the settlement figure agreed with Samsung so much lower than estimated as a minimum by the market? So I said out in the presentation some of the risks and issues that the board took into account in evaluating the settlement offer. In any litigation, obviously the minimum outcome. So that question saying the minimum outcome was a few 100,000,000. Obviously in any litigation, as I've explained, the minimum outcome is of course zero because you lost. With Samsung having their own competing and very low damages model and the company also having a low case damages model. As I said earlier, in three out of the four illustrative possible scenarios, the company would have netted a zero after costs. We understand that, you know, the Edison estimate was based wholly on public information. It made no allowances for possible discounts required in a compromised settlement outcome. It no allowance for risk mitigation, time, value, money, etcetera. And all of those factors could influence the final results.

48:00 And all of those factors were explicitly set out in the group's previous public communications. So we consider that the market was fully informed of the risks and the issues. The next question, it was a duplicate. So we won't repeat that. Next one, do you have a date to work two for the production of your dots in the sensor industry? As I said in the presentation, we said that we expect final validation of two materials before the end of July twenty three and anticipate commercial production orders for one or more of those materials by the end of December twenty twenty three. Question seven, eight, and nine were all duplicates of other questions. Excuse me. And then question 10, it's hard to believe that you've managed to take this company from being in such a strong position with almost certain prospects, you know, interesting use of almost certain prospects against Samsung to being such a worthless company with utterly unknown prospects.

49:01 Can you explain how this capitulation was for the benefit of anyone other than the company directors? If you really believe the commercialization was as imminent as you said, then a settlement worth $90,000,000 was not necessary to protect the future of the company. There's a couple of points or quite a few points in there. Response to that is we set out in the presentation how the board assess the risks and rewards and evaluating the offer from Samsung. Certainly not the case that we had, and I quote almost certain prospects. I think that's a significant exaggeration in our case against Samsung. I won't repeat all of the issues here, but as I've already said, with three out of four possible outcomes resulting in a net zero for NANOCO, That would also have undermined the commercial application of our IP.

49:50 Add to that a high win would inevitably signal a start of an extended appeals process with no guarantee of the outcome, needing more finance to do that, whether it's other forms of debt or equity, no guaranteed access to that financing and with no guaranteed outcomes. And of course, as I mentioned, the board took extensive advice and was advised through it by some of the best law firms in the world and the best IP experts in the world in reaching its considered conclusion in respect of the settlement offer. Next question, will you be commencing litigation against Hansel in Korea? And if so, will you be seeking a preliminary injunction which is available as a relief in South Korea? So the answer to that one is, as is a standard in this industry standard practice, Samsung, through their license agreement, have the right to have made materials under that license agreement.

50:41 To emphasize, it is a license agreement that grants this right. It's not the IP that they've thought. So the simple answer is if Hansel are only supplying materials to Samsung, then we do not have the option to sue them. However, if they are supplying materials or want to supply materials elsewhere, someone other than Samsung, then they or their customer would indeed require a license. And if they didn't take out a license, then they would face the threat of potential litigation. In the latest annual report, the chairman this next question. Yeah. In the latest annual report, the chairman described it as highly likely and a quote that the Samsung trial would run for seven years, I. Go to trial. Given the statistical likelihood of settling the strength of the case against Samsung and the fact that you accepted an offer below the market's expectation.

51:29 This was arguably a misleading statement. Do you agree? Fundamentally, we do not agree. When we published the last annual report, it was our recently held belief that we would go to trial and that if I quote from the annual report myself, quote, it is important to emphasize that Samsung is likely to appeal any verdict that favors NANOCO, unquote, and quote, as a result, we do not expect conclusion of The US litigation until the appeals process is exhausted, which could take some years, unquote. Such an assessment can only be made with respect to the specific circumstances in the case at the relevant point in time. Company did not otherwise publish or disclose any opinion on the strength of the case for damages against Samsung. And, you know, frankly, the best source of information for the market to make its assessment of the prospects in the case and the various damages cases was through the published court record of the party submissions and the various orders made by the court over the years from 2020 through to January 2023.

52:40 And question 13, given the depressed share price and the cash NANOCO will soon have on the balance sheet, a share buyback now would be in the best interest of shareholders. Will you propose shareholders resolutions to do a capital reduction and allow a greater buyback of shares? So we've already explained that we do need to carry out a high court approved capital reduction by eliminating or reducing the share premium account to allow us to create distributable reserves in the PLC. So that is our intention. That capital reduction will require a shareholder vote to allow it to happen. There are some other creditor protection actions that need to be taken, but we don't see those as in any way significant given the financial resources that will be available to the company when the second tranche of proceeds are received. So the reserves that are created by that reduction, assuming it's approved by shareholders will then be available to be utilized for any return of capital and whether that's in the form of a share buyback or in a dividend.

53:36 And the board will consider the most appropriate mechanism for any capital distribution at that time. And next question, can Samsung withhold payment of the second tranche of settlement money due in 2024? Certain preconditions are not met. If yes, can you elaborate on these preconditions? The simple answer is no. We're confident of meeting any of the remaining performance on the obligations under either of contracts as they are mainly of an administrative nature. And what I mean by that is we have to submit invoices on time. We have to certify our tax status, etcetera. The only real performance obligation in either of those agreements actually relates to the obligation to keep confidential. The contents of those agreements, clearly as a public company, we have to balance that with our obligations to disclose the material elements of those agreements.

54:29 And that's what we've done in the disclosures that we have made of the individual sums of money and some of the other facts that we have disclosed in accordance with accounting regulations and disclosure obligations as a publicly listed company in The UK. So the simple answer is yes, in theory, they could withhold if we breach any of those conditions, but I've described the conditions and there's no reason to assume we're going to breach any of those. So from all practical purposes, I did not anticipate Samsung having any basis to withhold that second payment. Next question, the location settlement update RNS states that NANOCO retains complete freedom to operate. Can you provide further clarification and wider context specifically, do the terms of the license agreement and or the IP sale allow Samsung or their commercial partners or their associates to operate as a direct competitor to the NANOCO for the supply of CFQD materials based on NANOCO IP to third parties.

55:33 Or b, in any way restrict NANOCO's ability to license CFQD manufacture to parties other than Samsung or their commercial partners or associates. I'm glad that the the the answer to that question is much shorter than the the question itself. So part a, simple answer is no. As explained previously, Samsung have the right to have materials made for inclusion in Samsung products. That's industry standard practice for those licenses. Otherwise, if you think about it, the license would actually be worthless to the licensee if the licensee can use it, but they've got no way to get material. But to be clear, that does not give anyone else the right to make material for sale to any other parties besides Samsung. I've already given the example of cancel cancel or supplying Samsung.

56:20 They're allowed to do that. They can't supply anyone else. Part b, is there any restriction on NANOCO's ability to license CFQD manufactured to anyone other than Samsung? Absolutely not. The license to Samsung is nonexclusive, so NANOCO can license to anyone that we want. Next question. Please explain why the Samsung settlement did not go to a shareholder vote. Please explain and properly address defend comments about corrupt behaviors, especially what is the true settlement and what non core patents were used as part of the settlement details exclamation mark. So answer that question. The settlement doesn't actually fall within any of the class test for anything requiring shareholder approval. And so that was appropriately a matter for for the board to decide.

57:08 And the company has already issued a short response to the recent shareholder letter in which we emphatically reject all of the speculative matters that have been raised. We have at all times adhered to all required standards and regulations regarding the regarding company behavior. The reference to, and I quote, true settlement is not something that we actually recognize in any shape or form as we have published the material details of both contracts. So there simply is no hidden quote, true settlement, unquote. And on the patents that we've disposed of as investors will already be aware every year, we carry out a review of our IP portfolio to assess our patents.

57:57 And for those that are of limited commercial value in the foreseeable future, and that's part of our annual review process. We're transparent about that every year. People will be aware that we reduce the number of patents, from three or four years ago, around 700 to 500 at the start of this year. That review identifies what we would call must keep patents or call it core patents. It also assesses things that are either currently in commercial use or potentially we can see in the short term, there will be of commercial use. And also there's a final category of patents where we, NANOCO from our perspective, think that commercial application is either uncertain or a long way away. And as I say, that's from the NANOCO perspective.

58:44 Other people may have a different perspective on those patents. The vast majority of patents that were disposed of fell into that third category. I a not currently in commercial use in the NANOCO and we don't see any short to medium term commercial application in our business for those patents. There was one patent with the associated other country patents that would have been in the second category of potential commercial use. But that patent again was not actually in use in our business. So as I mentioned earlier, the two patents that were the real core of our IP that were going into the trial, we've retained full ownership of those. Hence, that's why we got to the conclusion that the disposal that we made only involve non core patents.

59:33 We also got a license back on those patents, so we still have full access to them as a licensee and not as an owner. And the main difference there is when you're the owner, you can sell something and sublicense it when you're a licensee, you can't, but you can operate them. Question. Next question. This company used to have a really have a really opportunity. There's word missing there for long terms sustainable growth instead of a pump and dump enterprise. Where did that company go? As we said, I've done these interim results and previous results statements. We believe the long term growth prospects for NANOCO have never been better with two products undergoing final validation and commercial orders expected by the end of twenty twenty three.

1:00:21 With a validated IP portfolio from which we think we can generate further value over time. And they're all in a business on a robust financial footing. So we've always said we would focus on, I think people will be aware of my metaphor of the cake and the cherry. The cherry was always the Samsung litigation, the real cake, the long term sustainable focus for the business was around that commercial business. And that's where we think the long term value is to be generated. This is a supported by the proceeds from that from the litigation. Question next question, Krishna, attaining the interim results, it stays orders anticipated by the end of twenty twenty three. Is this calendar year, financial year, etcetera? For the production orders, it's calendar year. It's material validation financial year.

1:01:12 Question 19, NANOCO's RNS on January 9 refers to the range of expectations as previously guided. Please could you clarify where this guidance was to be found? There was a range of damages models, which we highlighted in any number of company presentations, probably five or six different times. These damages model were the subject of company submissions to the court and the interim court orders, all of which were in the public court record and referenced by the company. Due to the significant range of the potential jury outcomes of trial, we did not issue an opinion on jury verdict prospects except to refer and describe it as qualitatively to the potential for a transformative outcome.

1:02:01 I've also explained above why we consider the final outcome achieved with a settlement that got rid of litigation risks of a jury trial and meets that transformative target. Next question, I'll answer this myself, even though it's about me. How can Mr. Tenors inflated salary, approximately double The UK average for a company of NANOCO size be justified given the disappointed end to the litigation and continuing delays to organic growth? I'm I'll just make the obvious points. My salary is set by the remuneration committee. I know it's benchmarked against other companies, other listed companies on the main market, always similar size and situation. Just to remind shareholders that when I was promoted to PEO, I actually deferred to CEO.

1:02:49 I actually deferred my pay rise for for two years. And the leadership team has already mentioned that NANOCO GROUP took extended pay cuts to preserve company resources, and that included the payment of any bonuses in deferred shares rather than in cash. Next question was a duplicate. Number 22, why is the company ignoring the potential impact of German and Chinese injunctions on Samsung? Whole purpose of litigation in these countries was to counter the risk of long appeals. This appears to be conveniently forgotten about after the settlement. Commencing litigation on in other territories was deliberate and intended to put pressure on on Samsung. We succeeded in that objective. In order to enforce an injunction, it's a matter of law that if you want to enforce an injunction ahead of any final appeal resolution or ahead of any infringement decision, because you get the validity at this sorry, ahead of any validity decision because you get the infringement decision first. You actually be required to put forward a bond for the other side for lost profits that goes through to the end of the litigation process.

1:03:58 There that would have been extremely challenging. It goes far to say we could not have afforded to do that. If we'd waited to the end of the German litigation process, then to enforce the injunction, if we if we had been successful and if we had succeeded through appeals, obviously all at risk, then that actually timeframe would have taken you into the four plus years that we were talking about in in The United States anyway. So say the objective ensuing in those two countries was to bring pressure to bear and we regard the the settlement offer that was accepted as evidence that that strategy was successful. And yeah, just to remind shareholders, winning in one jurisdiction, for example, in The US and PTAB or in The US and court is absolutely no guarantee when in another jurisdiction.

1:04:48 The two are wholly unconnected, as I've explained before, because patents are actually written in different languages where individual words have different meanings and can be interpreted in different ways. And it is may well have been possible that new arguments could have been put forward for invalidity or for non infringement in other territories, etcetera. People do not have to replay the same script. You're basically starting from scratch all over again. Excuse me. Next question. What and how are you going to attract stable and reputable institutional investment to set a solid foundation for a share price? I'm gonna ignore the next bit because it's defamatory actually. So what are we going to do to attract stable and reputable institutional investment? As a board, we're very grateful to support our retail investors that they've shown over the past few years.

1:05:39 They've always been a part of the equity fundraisers that we've done over the last three or four years. As part of these interim announcements, turning specifically to the question, we are engaging with an encouraging growing number of UK institutional investors and also investors in The United States. And that follows a number of years where the potential binary outcome of both the of the litigation process combined with what was deemed to be a longer time frame to commercial production. That meant institutional investors were not attracted to the story. So institutions do not appear to be becoming more interested in the NANOCO story, and we are talking to them.

1:06:25 Next question is what were the reasons why the commercial order, which was intended for h one twenty three was then postponed to h two twenty three and now the end of twenty three. As long term investor, I've heard the announcements too often in recent years and it worries me. What can you tell us about it? Simple answer is, as I explained earlier, it's five year development cycles. And for these materials, they are very long. There are a lot of steps in the supply chain, you know, as we previously disclosed about The US customer Their decision there to end that collaboration had nothing to do with us or our materials. It was about other parts of the supply chain. Specifically coming back to today, the European electronics customer, they have a series of validation steps that our materials must go through before they can be formally introduced to the supply chain. And as I'm sure you can appreciate, given the potential end use applications, those are highly technical and require significant investing investment in multiple types of testing.

1:07:19 The customer is continuing to invest in the material and is testing, and we believe the product once adopted by the market will have a large number of significant applications. But ultimately, it's the customer's assessment of the readiness of the whole supply chain, including their external demand that will drive those commercial orders. We cannot force that to happen. But on the best information that we have right now, we've set out we're expecting when we're expecting those commercial orders. Next question, in the RNS, you mentioned two products ready for commercialization. Are the two products intended for use in different products? And can we assume that there will then be two low volume orders? Can you also define what you mean by the end of the year, October, November, December?

1:08:04 So the company is actively preparing for production orders at the end of the calendar year. So what I mean by that is by December, it could be a little earlier, but it you know, our best intelligence at this point in time is by December. Again, obviously dependent on final customer adoption of the technology. With respect to the number of products, the first commercial application could use one product, it could use both products and final visibility of that will actually come with the actual production orders. Next question, we're at 26, so a few more to go and appreciate wherever they are, but we'll we'll try to get through these. From the figures of the interim results, it can be seen that NANOCO will, sorry, reports. So that should say, will report a profit of £18,000,000 in the FY '23 statement and the net cash flow FY '23 is £4,500,000.

1:08:57 This will likely attract investors or make NANOCO interesting as a takeover target due to Samsung's future payment in 2024 and NANOCO's cash position in IP. What does the board intend to do to protect NANOCO from a hostile takeover below a fair value? And what do you define as fair value based on the outcome of the Samsung settlement and future organic business? So the simple answer to that, by continuing to deliver on our commercial projects, prospects, by delivering new license income, that's how we believe that the current undervaluing of the business will reverse over time. We just need to keep delivering on the commercial business as we've been doing for the last few years. Of course, ultimately in the event, if a takeover offer was ever received, any decision about that and price would be for shareholders to make.

1:09:45 So what management are focused on is our commercial prospects that we believe will lead to a growth in shareholder value. And that would be the best defense against logo takeover offer. But ultimately, as I say, that would be for shareholders to evaluate if and when such an offer arose. Next question, NANOCO is in a strong cash position by February 24, is the board considering acquiring other QD companies that are in a worse cash position to strengthen the NANOCO's portfolio. So, again, simply it's nice to have the firepower of the anticipated cash that's coming in. And we're always open to value creation opportunities. If one came up with assess it as and when it arose.

1:10:33 However, I would say that acquiring a loss making business where there was no obvious route to profitability, Well, I think we just risk losing our current hard one, very low cash annual outflow and would bring a lot more risk into the business than possible rewards. So as I say, would need to be evaluated if and when such an opportunity arose. Next question, you mentioned the r n s, the board intends to make a material return of capital. Would it be possible? What would a possible amount to the special dividend based on the knowledge you have today? So we've made the public statement that we've got a firm intention to deliver a material return of capital to shareholders. We will have to balance that with the needs of the commercial business.

1:11:24 We will give the board will give further consideration in the second half of this financial year, whether or not we feel in a position to issue quantitative guidance and to be more specific on what that word material means in that disclosure. But that's a conversation that still needs to be held by the board. Next question was a duplicate. And next question, NANOCO recently looked for staff on its own website. There've been no vacancies for a few days. Have you currently reached the level of staff you need for commercialization or have you stopped recruiting because commercialization has been postponed to the end of the year? So we've seen increased activity levels across the business, both in display and in sensing. We've been actively recruiting a number of what I would describe as frontline revenue generating positions, including r and d scientists, production chemists, direct support staff. So analyst engineers, etcetera, frontline operations.

1:12:23 And there are one also one or two back office support roles in there. It's fair to say that now with that head count increase from 33 to four four, which it now is complete. We have added the 10 people we have targeted to add. We're now fully staffed for a first commercial production order if it's at the lower end of volumes. We can scale very quickly if the first use case is a higher volume use case. We've already explained we have the facility and equipment in place to do that. It would just be a question of adding extra staff. But I think you can see, given our location in the Northwest, we're surrounded by a a large cluster of companies operating in high-tech materials and the chemicals industry. So we'd be confident if we did need the staff relatively quickly for a much larger commercial production order, then we would be able to do that quickly. So that's why we've stopped recruiting. It's because we've added the 10 people that we targeted and we're ready for first commercial production order.

1:13:29 Next question was a duplicate. And then finally, last question. In the statement by the chairman on February 3, he said settlement value is almost three times their own low case damages model. Was the market aware that a low case model was only, this question says, $50,000,000. And do you think this would have had an impact on market expectation if it was known? Just think I said it earlier, the damages models were made public in a court document in the middle of twenty twenty two in a motion submitted by Samsung to dismiss all three of our damages models. I think I know a number of folk are aware that we were planning on only taking two of those damages models into court. Again, through court published documents.

1:14:16 We never NANOCO never publicly commented quantitatively on the quantum of damages outside of the references to that low case damages model that would evaluate just the component in a TV versus the high case damages model that would look at the total value of the TV. And our use of words referring to the potential for a transformative outcome, which have already defined what we meant by that and why we think the outcome that has been delivered makes that definition. That's the totality of all the questions were submitted in advance. We'll stop there because we're significantly over time and we have a couple more meetings that we we need to get to. So thank you for listening. That's great, Brian and Liam.

1:15:06 Thank you very much indeed for addressing those questions this morning. As I mentioned, the company will review all questions submitted today and published responses are appropriate to do so on the Investor Meet company platform. Before redirecting investors to provide you with their feedback, which one is particularly important to you and the company, Brian, could I please ask you for a few closing comments? Okay. Thanks very much. So I guess I just wanna leave people with some of the comments I I made when they ran through the the summary slide. We do have a significant opportunity in in front of NANOCO given the display and sensing markets that we're operating in and where we are now with our materials and and proximity to commercial production. The proceeds from the Samsung litigation obviously provide provide us with a very strong platform and transform the certainly the financial position of the company.

1:15:56 Also, with having had our IP validated through that litigation process, that gives us the opportunity to potentially leverage further IP license income as markets grow. And as as I've already said, you know, our management team's focused on that commercial business to make it a long term sustainable growth in in shareholder value. Thank you very much. That's great, Brian and Liam as well. Thank you once again for updating investors today. Could I please ask investors not to close this session as you will now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations. This will only take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the management team of NANOCO GROUP PLC, we would like to thank you for attending today's presentation.

1:16:48 Good morning to you all.