Northcoders Group (LSE:CODE) — Interim Results

0:00 Good evening, ladies and gentlemen, and welcome to the NORTHCODERS GROUP PLC Interim Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged. They can be submitted at any time using the Q and A tab just situated on the right hand corner of your screen. Simply type in your questions at any time and press send. The company may not be in a position to answer every question received during today's meeting. However, the company can review your questions submitted today and publish responses where it's appropriate to do so. Before we begin, we'd like to submit the following poll, and if you could give that your kind attention, sure the company would be most grateful. Now I'd like to hand over to CEO, Chris

0:30 Hill. Good afternoon. Hello, everyone. Thank you very much for joining us. I'll introduce my myself. My name is Chris. I'm the founder the CEO of NORTHCODERS. I started NORTHCODERS over eight years ago now. I am a career changer myself, which gave me the idea to train people into software development. It sounds like it's out very well for myself personally. When I was working in corporate software engineering, saw a huge skills gap, in the market in when I was working for Sky, they were looking for dozens of they were looking for hundreds of of software engineers, and we just couldn't get people. So what we did is we began to hire, like, university graduates, and they just didn't really come equipped with the exacting skills required, by bios on the ground. So we were, like, running mini training boot camps for these individuals, and that gave me the idea given the traction of CODEON boot camps to go to Manchester and start NORTHCODERS in 2015, and I'm still here today. And I'll hand over to Charlotte to introduce herself and the other board members who are not with us today.

1:42 Hi, everyone. Thank you for joining us. My name is Charlotte Prior. I am the CFO at NORTHCODERS. I've been with the company, for around five years now. Sorry.

1:53 I am a chartered management accountant, and I look after the kind of finance payroll, HR function of the business. The other members of our board, we have Amol Batra. He is chief partnerships officer. Amol was a very early stage investor and chose to stay on and work for the company and heads up the sales and marketing function. We have two non execs. Nick Parker is from a finance background, and Angela Williams is from a, HR people background. Both have vast experience with PLC businesses, and help us along the way. Cool. I'll just go over some, financial highlights from the RNS this morning. So we are pleased to, report that revenue grew to 3,500,000 from 2,300,000, in the same period in 2022.

2:53 And we've had record demand for our consumer boot camp training, our core area of the business. This achieved revenues of 2,800,000, up from 1.7 in the same period in 2022. Our underlying, adjusted overall EBITDA was just over breakeven. This was in line with management expectations. We always planned to make investments into business solutions and tech returners in the first half of the year, And so this was in line with where we plan to be. So as as I said earlier, the consumer training boot camps area of the business grew by 65% and achieved an adjusted EBITDA of, just over 500,000.

3:40 This shows ongoing profitability in that area, and there is ongoing efficiencies to be making, with the encore platform that we are building at the minute. Loss after tax of 9,200,000, delivering an EPS of negative 2.07p. We have experienced some difficulties in the corporate solutions side of the business, which we will we will go over, further in the slide deck, but we are in a good strong cash position, with a strong balance sheet at the end of the period.

4:19 Some operational highlights. So our coding boot camp and training sector of the business has seen, applications more than double in the period to 7,107. And then, as at q three, applications stood at now over 10,000. We've achieved, further successful department for education funding. So we are currently working on a bid of 4,500,000. This runs, from October and then into 2024. And we currently have a bid out for, a further 10,000,000 of funding, which will start in February if we are successful in that bid and will run for eighteen months. The geographical expansion plan is going really well.

5:07 At the point of our IPO in 2021, we, only had students from Manchester and Leeds. We now have over 45% of our students coming from areas outside of Manchester and Leeds. This really opens up the job market and means that we can grow that side of the business further. Tech returners are now fully integrated into the business, and they provide, conversations with big corporate companies where we can cross sell NORTHCODERS products as well. And they are, we're now benefiting from efficiencies, between teams. Tech return has brought the reframe conference to the group. So reframe women in tech is a conference that's been run-in Manchester. It, attracts attracted around 750 people at the last conference, and we're now running that conference in London to increase corporate brand awareness in that region.

6:04 Business solutions, although, if we have faced a tough year we have been facing a tough year and we do forecast that times times will continue to be tough in that area. We are pleased to report that we have signed our first public sector contract. So that is with a significant government department. It's a small contract, but the good thing about that is that it enables us to create case studies and win further work in that area. Investment into encore is on track, and we are on track to to be running with that in, q one twenty twenty four. That will enable further efficiencies within the training area of the business and enable us to, increase profit margins in that area.

6:53 And then data engineering and cloud engineering are both, launched. Data engineering was launched first, and we are really pleased with how strongly that's performing. And graduates are going on to earn well over the average, of what we see from our graduate pool and cloud engineering is picking up nicely.

7:15 And just for some further financial analysis, if we look at the consumer boot camps p and l on its own, we can see revenue growth of 65%, no point five EBITDA, and a 1.9 gross profit on 2,800,000 revenue. As I said before, we've got further infrastructure improvements to be made, further efficiencies, further revenue growth. We are able because of our increase in applications to have the entry standard higher than ever. We are able to be more picky in that area and ensure that people leaving the course are of the highest standard. And in turn, the average starting salary is now increasing nicely at 28,500.

8:03 Obviously, that looks it's going down from that naught point five to the overall EBITDA. There's been some investments in overheads, so above the line investments. Business services, we've around 9,500,000 into overheads and 9.3 so far into returners. Business services is sales, staff, marketing, really making sure that that brand is ready for market, making sure that we are attending conferences so that we can go up against the likes of FDM, Sparta Global, and really make a dent in the in the, business services sector. Tech returners, we've done some work on commercializing their products and bringing them into the group, in a time where we have seen, a downturn in the tech economy. We have had, contracts delayed, we've had contracts deferred,

8:58 But we are we feel that we're in a good position to pick up on tailwinds, as they come through. Thank you, Charlotte. Charlotte. I'm gonna I'm gonna go over the company company overview. So we have two main divisions within the company. Our training boot camps division is our robust and core highly profitable business model within the organization, and the majority of the business our business over the years has stemmed from our training boot camp division. In fact, we've absolutely, you know, 50% year on year growth, from this from this division, and then we do continue to make further investments into our business solutions side of the company, which is our consultancy and our corporate academies.

9:57 I'll talk through the training boot camp division first and to explain a little bit about what we do within training boot camps. We have three main flavors of training boot camp, software development, data engineering, and cloud engineering. And the way that our framework works is that we have a pool of people who wish to join, so that's the application phase. And what we do within application phase is that we make sure that we're only selecting the real best people to join our onboarding and actually come into the training phase of our coding boot camps. It's around about 5% of people who applied for the course actually end up taking a seat on one of the one of the training boot camps. And the reason for that is that we would much rather have less people graduating from our course and keep that real high brand presence and making sure that everyone who does embark on the training group can get a, incredibly positive outcome for that individual, which is where the career element comes into the course. It's important to us every single person that we take on gets the outcome in which they hope for when they when they embarked on the journey with us.

11:10 So within the training boot camp division, over the next twelve to eighteen months, we're set to embark embark on some further growth initiatives, including new teaching disciplines, both within software develop development and other technical services. So we're looking at bringing in different programming languages to bolster our main software development training boot camps, is going to give us variants of outcomes for those individuals who take our courses. One thing that we've never really done is we've never really monetized the pipeline of people who come out of our course. Our community is now at least 2,000 strong. So we are putting together a series of courses which are for people within their careers once they do start out with the business in their first role where they can cross skill into areas such as, for example, your software developer.

12:00 Understanding cloud engineering is gonna give you some much better career opportunities. And that's whilst that's not something that's going to be like a huge amount of revenue, once we've developed the courses and people are sort of using their subscription credits to access those, they will be a highly profitable item within our with our P and L account. Charlotte mentioned before the encore platform, which is basically our sort of automation automated teaching platform at the moment. We have a very much what you could say is a demand driven service. So once one needs help, they press the button and we come along to help them. And what we are moving to to encore is we're moving to constantly monitoring that person's work and where they're up to and understanding how they're how they're taking the curriculum in and where they're getting to so we can begin to group people up into understanding and running like ature seminars where we bring people together. We're actually gonna end up being able to give people more of our time, but it'd be much more efficient for our teams and therefore our our cost base. And this is also proving that this is an opportunity for us to be able to launch a sort of part time earn as you learn program, which backed by our brand and the outcomes that we get for those individuals, we think could be a huge growth area for the business, something that we could certainly continue with our sort of geographic expansion possibly, you know, even outside of The UK because

13:30 it is rather rare that someone's able to offer such great curriculum framework, but with the access able to be part time distance learning and so on and so forth.

13:47 So the business solutions division, which is the division of this year, as we've explained in in in the message went out this morning, you know, we are seeing delays and deferrals of some of our contracts. Corporate academies this year have been a a difficult part of the business. But to put that into perspective, there's been some humongous redundancies made in the tech sector. You could take a company like Accenture. I think it was tens of thousands of redundancies that they had to make. So if you think that the graduate end of their business, once they're making lots of people redundant, they're not gonna be recruiting for graduates in in the same year. So therefore, those academies are put off. And then at the same time, some of our other clients who maybe are usually recruiting people from university to train into tech, there's a larger pool of people for them to recruit from with experience that don't need training that possibly, you know, more ready to hit the crowd running. So we have seen this year be a tough year, which has impacted on our forecasted numbers as we as we saw this morning. But just to explain our business solutions division, we have multiple levels of engagement with with with corporate clients. Launch is our hiring service where we are looking for opportunities for NORTHCODERS graduates to get their first time in industry, enhances a little bit of wraparound support for those individuals in their early years of their career.

15:10 Our elite program is where the very best graduates from Northcoast are on a consultancy basis, employed by Northcoast and deployed into businesses and then firms that are incubators where we also have senior team leaders to take away the pressure felt by businesses of bringing in people who are new to industry, new to technology, and we can really look after the the pain points for them within that. And that's something that we are currently embarking on doing with some large organizations such as equal experts within central government, and there's some huge frameworks that we've been put onto, which gives us good positive pipeline for the future. So in terms of the growth strategy for the business solutions division, we've got ex you know, a real focus on diversity within emerging technologies.

16:06 So when we're talking about developing AI, machine learning, data lakes, all the things that do underpin, you know, the hype around AI. We've got a real diverse group of people who are ready to go into that sector, which we genuinely believe we can be a spokesperson about how

16:24 good and positive that's going to be for the industry that we get people from all walks of life. You know, we've trained people, not just university graduates from the kind of same backgrounds as what has generally been the people who go into the technology sector over the years. But, we've you trained, we've trained a busker, and she's now a senior software engineer for the charity commission. We trained the Tanoin announcer for Manchester particularly trade stakes, there really is no such thing as a typical NORTHCODERS. And that's why as we embrace new technologies, you know, we think we've got real a real voice within that to for companies to to embrace bringing those type of people into these emerging technologies. We are developing our go to market strategy this year. We've invested in marketing, invest business development and sales. We're going to to continue to to to do so over the coming year whilst the contacts haven't quite started coming to fruition yet. We generally believe that, you know, we're not investing in something that's never gonna happen. This could really be the real hockey stick growth area for for NORTHCODERS over the over the next few years.

17:29 And from there, we've got a great sales pipeline. This has been a little bit unpredictable, but we're sort of really tightening up on on what we consider as a as a sort of contacted budgeted sale within this division.

17:47 In terms of competition, there's various angles. Obviously, this operates across sort of multiple multiple playing fields, and we've got there's a rather fragmented market when it comes to, like, boot camps and training providers. There's some very small providers, and there's there there is also some big ones, especially within skills boot camps. There's real barrier to entry now, though, when it comes to delivering the skills boot camps because it's not so easy to get onto those frameworks. That's quite a good defense strategy when it comes to to sort boot camps. So we have over the years seen people think, oh, that looks like an incredibly lucrative market, and I can get one of these, you know, CODE boot camps spun up relatively easily, but that's certainly no longer the case. HiretrainDeploy is a big market. You know, we are we and we are a challenger brand within that market, but we really do believe in in in the strength of our brand.

18:39 People often ask, know, well, what about universities? Are people not gonna go to universities to gain these skills? But the the the problem there is same as I witnessed when I worked for for for Sky all those years ago is that people aren't they just don't keep up with the curriculum. We're, like, on the absolute bleeding edge of turning around curriculum changes within weeks, not months or years unlike the universities. So that is the one thing that we can say is that we are definitely more in touch and ready to capitalize and prepare people for what technology sector wants today than your traditional university. So, yeah, of course, you know, the market conditions, you know, especially on the corporate side as we've as we've, talked about have been have been challenging this year. But, you know, despite those challenges, we do generally sit here and believe that tailwinds will come from the situation that that we're in now. And what we've gotta do as a business is be ready to sort of jump on that bike at the top of the hill when when those tailwinds come.

19:45 There's been quite a lot of sort of macro uncertainty, different decisions within government, but none of those have affected, you know, where we are as a business and things like our skills boot camp frameworks that that we work within are incredibly robust, and we've not seen any problems there, whatsoever. And, ultimately, in, you know, in in the areas with which we we operate, there's still a humongous skills gap, and there's new technologies coming in that people don't understand how to embrace and we are, you know, perfectly positioned to help businesses and individuals work with that. So we're incredibly confident as to the future of the business. Cool.

20:31 So to go over some finances, we have a graph on here to show the the revenue makeup. As we said before, it was predominantly consumer trading in the first six months of the year. And the revenue growth per half year, as you can see from the bar chart, is growing has grown half year on half year. And that's something that we are proud of, that we have grown revenue in what has been, a really kind of uncertain economy for the tech industry. There's clearly still, really high demand for our courses. And a lot of people talk about AI and whether that's kind of whether that's going to, affect us as a business. I think and what we have kind of seen is that, the more AI and the more tech is talked about in the in social media, the more kind of it it attracts people towards a technology career.

21:28 And so we can see here on the p and l, 63% gross profit margin, and then how that kind of falls down to the net loss after tax. On the cash flow side of things, we are we have a comfortable cash position. We've had no new bank loans in the period, and we are repaying bank loans. We're keeping an eye on these as, obviously, interest rates have increased, but we do have fixed interest rates on those loans. We don't have the Santander Seabills loan anymore, which was tracked on base rate. We have fixed interest rate loans, and we also have our large cash balance in

22:13 a nice savings account, so that should offset some of that interest too. And no bad debt in the period. We have tax refund from r and d activities. And then if we look at the balance sheet, not the most detailed balance sheet, but it's kind of shows that noncurrent assets are growing. We current assets have obviously grown in the period along with cash, and the noncurrent liabilities are obviously reducing as we pay off those bank loans.

22:52 So a summary of, the the overall sentiment of the RNS today, application momentum is continuing as we've said. Demand for our core products is higher than ever. We are really happy with how data engineering and cloud engineering is now performing alongside software engineering, opening up that market even further for us. Happy to to say that we are still receiving support from the UK government on the skills boot camp initiative. They allocated 1,500,000,000 over the next six years. We are on that framework. As Chris said before, that creates a barrier to entry as if you are not on that framework now for the next six years. They you you people won't be getting onto there.

23:41 And application acquisition, sorry, of tech returners going really well, enabling us to be able to offer diversity pipelines. And we talk a lot around business solutions in that we are waiting for the market to pick back up, and we're waiting for a turn there. But what we are what we do have as a strategy is that a lot of big companies are dying out are crying out for diversity, and they are receiving a lot of pressure from the government bodies in that they need a more diverse workforce to be able to carry out these government contracts. So we are, well placed to be able to help out in that area. But, we can we can obviously ignore the fact that there's been budget constraints, workforce reductions, recruitment freezes, and that has led to, our corporate clients delaying and deferring budgets.

24:37 In line with management expectations, the current financial year is presenting some challenges, and the numbers that are out in the market have significantly reduced. We are very confident in the numbers that are now out in the market. We have been incredibly prudent when speaking to our analysts. We have made sure that the numbers that are out in the market, we have visibility over and that we are not in a position where we are promising too much. The tech economy obviously is showing some signs of improvement. We have just come out of August, which is usually a quiet month for us. And we've had a record month in August on the consumer boot camp side, and we are having a lot more conversations with corporates as we've moved into September.

25:30 And as Chris said before, we're now on the Dallas framework to pick up more government funded work, and we are in a really strong position when it comes to cash and balance sheet, and we are not looking to raise any money to to carry out the investment activities that we that we have planned.

25:55 That's the end of the slide. That's great, Charlotte. Chris, thank you very much indeed for updating investors this evening. Ladies and gentlemen, please do continue to submit your questions using the q and a tab. Just on the right hand corner of your screen. But as well, Chris and Charlotte, a couple of moments call call I'll Thank to over event and during the presentation. If I could ask you just to read out the questions, and I'll pick up from you at the end. Cool. Okay. I'll go first. Charlotte with the first question. So it's it's are there any plans to increase the float availability of shares thus encouraging more institutional investors into the company?

26:42 There are no plans at present to raise any more money from the market in terms of new shares for new money. It's not something I planned. We are in a very strong cash position, and we've got investments we can make off our own balance sheet. In terms of encouraging institutional investors to join the story, and there is many different ways in which they can they they can do that. We are certainly in conversation with some who are incredibly excited over over joining us, but they can buy shares in the market or there is obviously some institutions that may be in a position where they wanna exit their position, and we're always running our investor relations in a in a very open way through our brokers that we know when those opportunities might arise, that we can ensure that that's the the best situation for for for everybody.

27:34 And then we've got can you give an overview of the industry? Who are your direct competitors and what is the market share makeup?

27:43 How's the market share changed in recent years?

27:47 It is a difficult question to answer, the size of the market and what is our market share because the market I mean, where do you where do you start? Where do you stop? Do you if you talk about just data engineering boot camps and coding boot camps, we can definitely say, you know, we are the the biggest player in the in The UK market without a doubt. When you start bringing in universities, hire trained deploy, companies like, FDM who are on the FTSE two fifty that that that that do similar activity, then the market is incredibly vast. And then some of the, you know, the largest consultancies are also considered part of that market. So so our share would be incredibly small, but as is our opportunity. So it depends how you look at me.

28:32 In terms of, you know, core training boot camps, we are the we are the leading provider on that in terms of numbers and delivery of of of those boot camps, and the market has been growing. We've been growing. Again, as I said, I think at the beginning, you know, 50% year on year, and, you know, the market is certainly is certainly keeping up with that. Pricing trends, Charlotte, I think. Next. Yeah. So what the next question is, what do you what do your current pricing trend look like? We have increased prices over the last few years in line with inflation and in line, with our kind of boot camp becoming more reputable and, the fact that we are creating higher and higher kind of wage opportunities.

29:25 And we have a lot of con a lot of our boot camp contracted with the Department for Education, and we're happy to, kind of say that whenever we have increased the prices with them, they have, they have allowed that. And so our current pricing trend basically looks like we increased to cover inflationary and cover costs, but we're not too much higher than competitors. Our main competitor is probably Makers, in in London. And then there's a lot of other smaller coding boot camps. And but relative to our kind of main competitors, we're we're not too different. Cool. I think the next question is about everyone's favorite topic, AI. So it's talking about AI, artificial intelligence. How do you think how does the future of the CODE look? Do you see AI as a threat or an advantage to the job of coders and in certainly in terms of in detail the junior market, do you expect that it will massively affect the the junior market versus the opposed to senior coders?

30:37 In terms of declining roles for junior developers versus senior senior developers, I would say that probably a bit like if there's no puppies, there's not gonna be very many dogs in the same way that people are always gonna have to progress through that career. It's about I think it's more about where it starts. So in terms of AI, we see ourselves and and and, yeah, nobody has seen like a sort of a knee jerk AI strategy from NORTHCODERS or, you know, a massive marketing push on,

31:09 you know, come and join our boot camp because we teach the best in AI. And that's because within, especially, data engineering, I mean, AI and things that we know, like the the the the chat apps that we're all, you know, used to getting right in Postgres and so on are all large language models, which are basically built upon data lakes and machine learning. And those things have been embedded into our data engineering curriculum from from from day one as it stands. So if anything, know, we are empowering people with the skills that they need to to to go into those arenas. And as far as the one thing that, you know, we're sort of what, you know, what what what is our beacon? What is our voice when it comes to AI is everyone's talking about AI being, you know, the next thing that takes over our lives that it's gonna ultimately, you know, reshape what it means to be human in some senses. And our take on that is we'll make sure that while we're doing that, that when people are going into these junior engineering jobs and people are, you know, becoming, like, emerging technologists, make sure that we're embedding them with those skills that they need to to use AI to to to the best of their power.

32:17 You're not gonna replace your software development team by using AI. But, yeah, they probably can use that to be better and therefore add more add more value to your to your organization. And then there's also the diversity element. You know, we're super strong on diverse teams and bringing people into the industry from the backgrounds that we've discussed previously, and I personally think it's super important that people that go into developing the AI applications that we do make sure that that's represented from people from multiple backgrounds as opposed to your sort of standard similar background through university and into the technology sector as it as it definitely has been from what we've seen through the well, the way that technology has emerged over over the past decades. We have one here. Can you tell me about industry capacity?

33:09 Is demand faster than the supply? I think we all kind of have heard about the digital skills gap in The UK and how we feel like as an economy, we need to level up in the tech sector and how there's not enough digitally skilled people. I think the pandemic only elevated that and only sped that up in that the world is much more digitalized. And when we talk about AI, that kind of pushes that agenda forward as well. And so, yes, I I would say the demand is faster than the supply, but I think it's also about getting about not saturating the market in in specific areas and around ensuring that we we are training people to a really high standard so that they can go into and and make a real difference in these jobs.

34:04 Cool. What planned investment do you have have you identified in the business for the next six months? So three key areas. One is our end core platform, of which there is a more detailed question about later on, so we'll leave that one to answer there. Secondly is the continuation of our business development activity, you know, we're building a corporate presence in London. We're running, like, our reframe conference here, in London, for example. That's one of those things that that we are investing in doing. And then, yeah, we've got new technical areas within our within our disciplines that we're investing in, albeit sustainably in a way that we're developing new initiatives such as the part time boot camp and the different flavors of our course as we go along, as we generate cash, and we're just doing those investments as and when it's right to do so and keeping our keeping our very strong cash position rather than raising any new money.

35:06 Next one, when you referenced geographical expansion, are the plan are the plans for growth outside The UK? Currently, we have had some students outside of The UK, so our training platform is all streamed out online. So, technically, we could teach, people from anywhere in in the world. I think we've had a student in France, a student in Hong Kong, a student in Iceland. Right now, we are teaching nine to five, Monday to Friday, and so that wouldn't work for someone on a different time zone. But when encore comes into play and the part time distance learning courses come into play, there's no reason why we can't grow outside of The UK. There's obviously a bit more legislation for me to get my head around when it comes to outside of The UK, but it's definitely not a reason to obviously not go into growth in other countries.

36:06 Cool. Thank you. Are you still running the Rolls Royce program? Are there any other opportunities like this with other companies? Yes. There are lots of opportunities like this with, lots of other companies. We are finding it at this moment in time difficult to get commitment and start dates, and it it feels like it's ever moving, you know, contracts. Like, we've got another contract, is about security clearance, which so far have been delayed since April. You know, we we we have hit some sticky patches with getting these contracts started and the revenue recognized for them at the moment, but we haven't yet thought that's gonna be a a huge problem. So, yeah, the incubator accelerator is very much where we plan to continue to to grow in the near future.

36:56 Can you expand on the encore platform revenue opportunity? How do you charge, and what are your expectations here? So encore's our revenue generating piece of technology. As such, encore could potentially generate will will will generate further training courses and ways of delivery such as part time. What encore is all about is it's all about monitoring each learner as they work through the program and being able to group people into certain understandings of certain concepts. So that, let's say, for example, if instead of it being someone presses a buzzer when they need help, that we've got a group of five or six people that encore has identified are finding it a struggle to get past point x in some certain piece of the coursework. So we can grab all those people together no matter where they are, no matter what time it it is, and we can initially deliver live content to those people in terms of a miniature seminar group, giving the learners more time, but also meaning that we have less of a bank of people sat there waiting for these type of requests. But, of course, in the future, there's very much a way that if we identify that we're delivering multiple of these breakout sections of that that are always about one particular core concept as we do now.

38:18 We'll be able to predefine written video and exercise content to be able to to deal with that without the need for intervention from from from one of our teams. So it's very much all about efficiency and experience at the the the end call platform. That's great. Charlotte and Chris, thank you very much indeed. You've taken all those questions from investors, and thank you for your engagement this evening. Chris, Charlotte, I know investor feedback will be important to you. I'll shortly redirect those on the call to give you their thoughts and expectations. But if I may, Chris, just ask you for a few closing comments just to wrap up with. And then as I said, I'll go and redirect investors to their feedback. Yeah. Amazing. Yeah. Yeah. Thank you everyone for joining us and taking the time. We love to answer, and we have huge confidence in the business due to the fact that we have got this underlying training boot camp business, which is, as said, we've grown that 50% year on year, and we've grown that significantly in the comparable period from the first half of this year to first half of last year.

39:21 That underlying is incredibly profitable and generates cash to really strengthen the balance sheet without the need for for, you know, for dilution investment. But, yeah, we also do have so many opportunities that we are looking to to capitalize on, and we have also got the way that we are gonna manage the kind of investment into those air into those areas in the in the coming year. And, yeah, we're really excited just to keep going and see where we get to. That's great, Chris. Charlotte, Thank you once again for updating investors this evening. Could I please ask investors not to close this session as we'll now automatically redirect you for the opportunity to provide your feedback in order the company can better understand your views and expectations? This only take a few moments to complete, but I'm sure we'll be greatly valued by the company. On behalf of the management team of NORTHCODERS GROUP PLC, I'd like to thank you for attending today's presentation. Good evening.