Pci-Pal (LSE:PCIP) — Review of results for year ended 30 June 2020 and update on prospects

0:04 Good morning, ladies and gentlemen, and welcome to the PCIPow PLC presentation for the year ended 06/30/2020 and update on prospects. To start with, if we could cover a couple of housekeeping items. Before we begin, we would like to submit the following poll, which you will see on your screens.

0:26 Throughout this presentation, investors will be in listen only mode. However, questions are encouraged and can be submitted at any time via the Q and A tab situated on the right hand corner of your screens or if anyone has dialed in via pcipalwarbrookpr dot com. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. These will be available via your investor.me company dashboard. Finally, we'd like to remind you that this presentation is being recorded. We anticipate that there will be some newcomers to PCIPAL, so we will take a couple of minutes at the beginning of the presentation to introduce the business.

1:18 I would now like to hand over to Chief Executive, James Barham and Chief Financial Officer, William Good. James? Thanks, Tom. Good morning, everyone. I must say William and I are really pleased to talk to you all about the business today and to have the opportunity to provide this very positive update on PCIPOW following our year end. It's been a substantial year of progress for the business, particularly given it's been despite global pandemics, Brexit, elections and everything else that's been thrown at us in the year. So thank you all for taking the time today. A big welcome to those who are new to our story. Please do check out our introductory presentation on Investor Meat Company and do take a look at our website, Knowledge Centre, to dig a little more into our story as well. And welcome back to our existing followers and, of course, our existing investors.

2:15 So today, you have myself, James Barham. I'm CEO of the group. And with me is William Good, our CFO. The presentation today will broadly follow the flow from the prelims RNS posted this week as well as providing a look ahead into my near term focus points for the company. So as Tom said, before I do that, let me give you some background though, particularly for those that might be new to our story. So at PCIPower, we work with any size company to give them the ability to handle credit and debit card payments from their customers securely. We protect this data whenever a customer is making a payment either by phone or through any digital payment channel. The vast majority of our customers utilise our services within contact centres or call centres as they were traditionally known.

3:05 And what we do not only secures a company's most sensitive customer data payment data, de risking their business from the risks of data loss, but it also allows them to comply with the various governance standards that they must adhere to, no matter where in the world they're based. In particular, though, it relates to PCI compliance, which is the set of rules that govern how companies must handle customer payment data so, as I said, that's credit and debit card data and a PCI power with the highest level of compliance against those PCI standards, which means we can handle data for any size company anywhere in the world.

3:47 And more than this, we make the process of securing this data easy and cost effective, and we do it in such a way that doesn't compromise the way these organisations wish to to engage with their customers. This is a real USP for us, actually, and this is key in a contact center environment where customer experience is is really everything. Onto our products. We've we've three core products primarily that we serve from our global cloud platform. We have agent assist, which is live agent payments. That's when you have a call center agent and a customer on the phone speaking to one another. We have IVR, which is automated payments, so this is the type of system you may have used where you press 1 or press 2 as you're going through or it might be a speech enabled automated service as well.

4:38 And digital, which we launched in January this year and enables secure payments through any number of digital channels like web chat, chatbots, SMS, social, email and any form based data. We sell these products primarily through channel partners, which in the main is through resellers, many of whom we integrate our secure payment services to their own cloud products. I've got more on our channel model later, so I won't go any deeper than that right now. But hopefully, that gives you a snapshot of what we're all about. As I said at the beginning, a hugely exciting year of progress and growth for this business. Since we started on this journey nearly four years ago, it's felt that this has been the year that's really proven out our SaaS revenue model, growing our revenues by 56% year on year. And it's this expected jump which is a result of accelerated increase in our new sales bookings that we've made over the last twelve to twenty four months, which has increased our key sales growth metrics of both ACV and TACV quite considerably, and William is going to talk more to those in a moment.

5:57 I'm personally particularly pleased though that we've achieved these steps forward despite COVID and I must say that our team has really excelled under what's been really challenging circumstances for everyone personally, everyone in this school, everyone within our business, everyone across the country. So whilst COVID did have an impact on us, there is an upside and we've been able to continue our momentum, making a good strong start to this new financial year as well. And just to round off this section, in terms of the PLC and the Board, we have strengthened our Board during the year, putting in place a new US based Chairman, Simon Wilson. Simon has extensive international, private and public software growth company experience.

6:43 He's also a British and US passport holder and someone that was known well to the management team prior to joining. Now moving on, I'll move on to our COVID update as is the way these days. No major change really to our views since the trading update in July. We're very well positioned as a business to minimise any impacts on the company. We've seen an uptick in demand for our services, which is a fairly natural consequence of the increased levels of home working that are going on everywhere today. Data security is a big part of any employer's risk considerations when moving teams to work remotely. We've seen urgency for project delivery continue at the peak of the demand from new customers.

7:29 They wanted delivery yesterday. That's calmed a bit, but clearly new customer deployments as a result of COVID-nineteen interest do move at pace and there's a lot of demand there for them to move at pace. But we've been able to achieve this given we're cloud only and we can deliver our services entirely remotely. One of the main challenges we've had is a reduction in the predictability of the timing of new deals. So clearly, impacted us in our Q4 as COVID hit for the entirety of our Q4 lockdown, pretty much, as new prospective customers put procurement activities on hold. And this was mainly while they were figuring out their own response as a business to the pandemic, let alone sign a PCI-PAL contract. But this has certainly subsided a bit and since the start of the new financial year, we're building a very strong pipeline in general, which should serve to minimise any risk here as we've got a really strong opportunity backfill through that pipeline as well in in the event that there is any movement.

8:36 Now, we do benefit from having a channel first sales model selling through resellers. These resellers are generally quite large and financially stable organisations with many of them similar to us, being cloud focused and very capable of operating as normal during these more difficult times. We've actually been very busy working with these partners who've been driving marketing and PR to increase awareness of their services and also the importance of ours too for home working. So we have been riding on their coattails, you could say, but that's an essential benefit of our channel model and it's very purposeful on our part that we get that opportunity to do that. That activity, plus generally a rude awakening that many companies have had regarding their communication solutions during this time, ability to work from home, flexibility, all those considerations.

9:34 This is what we believe will actually drive the pace of change in technology adoption from traditional on premise hardware solutions to highly flexible, robust cloud products. And this will certainly be good for us long term being a cloud vendor ourselves. So to round that out, on the basis that we've got good confidence in the strength of our sales pipelines today and that we're operating in line with our own expectations at the start of this new year and we can still deliver projects at pace, we've maintained market guidance and we fully expect to take another significant step forward this year. That's all from my summary for now. So we'll start getting into some of the detail, and I'll hand over to William for the financial highlights now. Over to you, William.

10:28 Good morning. These are the financial highlights of the business. I'm gonna talk a little bit more in detail in subsequent slides about, the revenue, and our recognized revenue, the TACV number, which is a key metric for us, which is is basically a metric for recurring recurring revenue, our cash position and financing. But the financial highlights is a good year for us, despite all the challenges we've we had at the end of the period. Revenue increased year on year, 56% to 4,400,000. Of that, 84% was recurring revenues. That's pure license, revenue, which we'll see into the future. Our gross margin continued to improve to 69% and will continue into the future. Why is that? Because we have a all our new sales are going on to our own AWS platform.

11:22 We increased our ACV figure in the year. Now ACV is the recurring revenue we sign in a period. So in the year, it was up 37% to £2,600,000. And more importantly, we increased our TACV, which is the total amount of contracts we hold with recurring revenues, to 6,750,000. Our loss came in line with expectations in the market, and we finished the period with cash of, 4,300,000, having undertaken a a fundraising in March, raising £5,000,000 from existing shareholders. And in addition, I've got £1,250,000 worth of, debt facility available, which will be drawn down this month.

12:08 Just turning to recognized revenue for the period. The, yeah, the revenue we, we haven't we have announced in the accounts. We do monitor this on a half and half and a year on year basis to make sure that we are maintaining momentum. So half and half, the revenue went up four 43% and year on year, 56%. Why the slight dip in percentage? Well, that's just down to a pure factor of, the size and of deals that happen to go live in the period. It's nothing to worry about. We're it's just something we monitor every month going forward. As I said, recurring revenues is 84%, and that's the important element of this of this graph. The black bar, which shows 1,964,000 worth of revenue in the half, well, that is our pure lie that is our licensed revenue coming through to us and our recurring revenue. The orange blob at the top relates to the treatment of our professional services and setup fees, which have to be prepaid over the length of the contract or the estimated contract contract length under the rules of IFRS 15.

13:15 So during the period during the half, we released nearly £300,000, and in the year, nearly £600,000. PS is an important element to our business because it actually allows us to, generate cash. And in the year, we signed £1,200,000 worth as part of our contracts. These are all charged on signature, get collected, and then we, and that forms an important part of our cash flow. As I say, gross margins were 69% in the period for the year. We do expect that to continue to improve, and it should head up to the 85% over the next couple of years as the AWS contracts become more dominant. Finally, in the in the accounts, we announced that in the first two months trading to the of the new financial year to the end of August, we've continued the strong momentum with our revenue is up 41% when compared to the same period in f y twenty.

14:22 Turning to probably the the most important metric we have within the business, which is our TACV. Now this is the, you know, this is the metric of all the contracts, all the recurring revenue contracts that the group holds, you know, whether they're, live or in deployments or or, you know, sitting, waiting to go into deployment. So, yeah, I finished the year, at the June 30 with £6,750,000 worth of, contracts sitting in the filing cabinet that will generate when old when deployed, £6,750,000 worth of annual revenue, which we expect to go off into the future. We started the year with £4,100,000 worth or just under £4,100,000 worth. And so we've had good growth through the period, mainly on the back of our strong ACV sales.

15:16 The reason why we monitor this this the TACV so carefully is that, ultimately, it's the future metric for profitability and cash flow. Currently, as we're a loss making company, we just we we need to make sure that we get to that point where we have more revenue coming in than cost going out. Now we finished the period at the June 30 with 6.75, as I said. And our underlying cost base, excluding commissions and, amortization, was a shade over £7,500,000. So if all the contracts were deployed, then we would have a, you know, an ongoing loss of £1,000,000. Now moving forward into f y twenty one, if you make the assumption that we're signing similar amounts of revenue, and that's what we need to do to be able to hit the new FinCap forecast, then we should finish the year in June 2021 with 9,800,000 or so of TACV.

16:18 That means I would have that amount of contracts sitting in the filing cabinet. And at that point, we will have more contracts available to us than our cost base, which means that, you know, we once they're deployed in f y twenty two, then we will be able to, report profitability and cash breakeven, which is an important metric for this business.

16:45 Moving on. Just looking at the TACV by region. We entered The United States. We started selling our our, services there in February 2018, and that is the orange bar section on the top of this, of the top of this graph. As you can see, that's starting to grow strongly. And, ultimately, we expect that orange bar to overtake, in scale the the the the black bar at the bottom, which is our EMEA market. The EMEA business has been, is a more mature business and has been established longer. So, hence, it's growing slightly slower, but we expect The United The United States and Canada to overtake that. The other thing to realize at the end of the period is not all the contracts we hold are deployed and therefore generating revenue.

17:37 At the June 30, out of the 6,750,000, we had 4,100,000 that was deployed generating revenue. So I was releasing equivalents of ones one twelfth of that number to the p and l. Going through our deployment service, we had £2,100,000 worth of contracts, which included two large contracts we won, last year. I'm pleased to say that the the large US contract, which was $550,000 worth of annual recurring revenue, has now gone live. So if you jump forward to today, about 2,100,000 has gone down by 500 you know, by £440,000, and the deployed recognizing revenue figure has gone up by £440,000. So, ultimately, all that 2,100,000 will become live, and that is, therefore, used to underpin our revenue guidance for this financial year, which stands at £6,700,000.

18:35 You'll also see there's a small element at the bottom of on hold or awaiting kickoff. We always have a set number of contracts, that are on hold. They're on hold for two reasons. Firstly, either the customer or the partner is real is organizing its, resources, on its side to be out, to be able to deal with the integration we need. Or secondly, the sale we have undertaken is part of a bigger one through our partners, and the partner is new to the customer and is putting in their telephony and, CRM systems first before they can link us link us in. And so we have to wait in line until that happens. But, ultimately, we expect that £500,000 to eventually become into deployment and then eventually be deployed and recognize revenue.

19:29 Just moving to the income statement. I've already talked about the, the high level of recurring revenue visibility, which is, driving the the value of this business and the gross margin. The other point I would like to point out here is the staff cost within the business. Yes. They went up 24% in the year, which reflects the sort of roll out of of the people we hired in f y nineteen. We now have 58 employees within the group. The good thing, to what I can confirm to you now is that we've built the sub the structure, we require to drive this business forward. So we won't be doing significant amounts of hiring for, new people. And we've already built our sales teams, our engineering teams, and our professional services teams, with the capability of handling significantly, you know, the the the amount of business we are generating.

20:20 We will be taking on new people, but they'll be more tactical. So I'm expecting the growth, in staff costs to slow down. And as staff costs equate for 80% of my overall overheads, that, you know, that will slow the growth in in costs, but we're not expecting recurring revenue to slow down. And this is why we're confident that during f y twenty one, we'll start showing pro progress towards improved pro improved loss. And then into f y twenty twenty two, we should hit that milestone where we hit both monthly cash flow, breakeven and monthly profitability. The cash flow will come ahead, of the profitability because of the nature of our SaaS SaaS model. Just turning to cash flow.

21:10 The business we you know, the business is funded by three areas. Our cash reserves, which were 4,300,000 at the year end, our debt and any equity we we raise. The debt facility, I've still got 1,250,000 to to to draw down on, which will be drawn this month. The other important area of finance for us is our advanced invoicing. Because we're a SaaS business, what we what we like to do is

21:37 we will charge PS work and setup fees on new contracts. And as I said, that was £1,200,000 worth last year, and they are charged on, signature, in advance. And we also, where we can, charge for annual annual, licenses

21:55 in advance. So if you look at, the fifth line of that table, you can see our deferred income went up by £2,000,000 or £2,100,000. Well, deferred income is the is the, is a metric for the amount of advanced cash, we have generated. So with that advanced invoicing coming in and a, you know, and a minimal amount of investment in, licenses and property and plant, we actually only used £3,000,000 worth of cash, you know, during the year in spite of recording a loss of 4,300,000. Now we finished the year with, 4,300,000 of cash and £1,250,000 worth of facility to draw, which gives me, £5,500,000 worth of cash, to cover the losses for this year, which will be decreasing, and, as a small amount of losses in f y twenty one. So we are in good position and good shape to, make us, to take us through to that that magic point of cash breakeven.

22:59 In addition to this, we do have further debt. We are expecting to put further debt facilities in place to to help the business.

23:12 Finally, just looking at the balance sheet, you'll see that there's heavy, investment in fixed assets. Well, that reflects the investment we're still putting into our a a AWS platform, which was nearly £1,000,000, in people. I'm expecting a similar amount this year before it starts to wind down in f y twenty two and f y twenty three as the as the platform becomes more mature. The other area, to note is trade debtors at 1,260,000, which seems high against the, which seems high against the, business when you're only generating £4,400,000 worth of turnover. Well, actually, if you analyze that to trade debtors, the vast majority of it does not equate to invoices that affect revenue.

24:01 Half of it related to new contract wins, and so those are, you know, the the professional services setup fees and new in new licenses coming through, will go and sit in deferred income. The other half of relates to our renewal cycles on contracts, and quite a lot of those relate to bills on advanced invoices as part of the of our contract cycles. So in in total, we actually we collect all our debts in just over two two months.

24:35 I think that's that's more than enough from me. So at this point, I'll hand back to James. Thanks, William. Okay. So a brief update from me on our cloud technology. But as I said earlier, please do watch our previous presentations for further detail as we're a bit limited on time today and I'm quite keen to leave some time at the end. Cloud in general is really important to us. We talk about it a lot and it is one of our competitive differentiators as well in our market. We we were the first in this growing space to launch a cloud only product offering, and we're the only provider in our space with a global cloud presence with a partner first go to market sales model. And it's a critical component of our recent success in winning partnerships with some of the fastest growing, most popular cloud telephony vendors in the world, some of which we've listed like Vonage, Talkdesk, 8x8, all global operators growing very quickly.

25:38 We have instances of our platform across EMEA, North America and ANZ, Australia and New Zealand. We launched the platform in October 2017 having selected Amazon Web Services or AWS as our our hosting partner. And since then, it's matured a lot and we've customers live across all of those six regional instances worldwide. Prior to this platform, we did run a more traditional privately hosted environment in The UK, which we still have, but we've purposely not sold any new business on this platform since early twenty eighteen, so nearly over two point five years ago now. But this is one of the reasons we're experiencing such substantial increases in our gross margins as the AWS hosted services have been sold for some time and they're very much margin heavy as they come through, and that will continue to increase those margins.

26:39 As I mentioned earlier, we did launch our digital product earlier in the year, and since then, we also launched Rapid Remote, which is a rapid deployment version of our agent assist product, which we fast tracked as a response to the increasing demand we were seeing for secure payment solutions for home workers, and that was during the onset of the pandemic. So we were quite opportunistic there to a degree. It's actually been really successful for us. And as we anticipated, it did open up a number of discussions, including with the largest customer that we signed in our Q4, which is now live in record time as we've reported. Along with cloud, the second pillar of our current strategy is our channel go to market sales model.

27:26 We set out an objective several years ago to become a channel first business. Within two years, we'd achieved this with the majority of our sales coming from channel partners. And in the year, just gone just under 80% of our new customers came through channel partners. I'll often refer, and I have in this presentation, to our channel strategy as being channel first or partner first, and that's because we're not channel only. We do sell direct, but this tends to be more enterprise sized deals which are much more like a large partner to deal with, actually. And we're certainly seeing more enterprise sized organisations looking to the cloud for security solutions, just like the two enterprise deals we signed in the year, one in The UK, the other in The U. S.

28:13 Now whilst the majority of our new customer contracts came through the channel, the proportionate value of these contracts is lower, currently at 42% versus direct at 58%. Now we do anticipate the proportionate value of channel deals to increase over the coming years as whilst to date our direct deals have tended to be higher value, the volume is now coming through from our partners and this is where we will achieve scale. After all, the majority of the contact centre market opportunity is less than two fifty seats in size and in contact centre terms, that's mainly your small to mid sized centres. And channel really does give us the ability to service the entire market opportunity no matter the size of the customer.

29:03 We've also evidenced the increase in channel deals that are coming through in the year, as I've just touched on. In our Q4 alone, we signed 37 new customers, which was actually in the year a 76% increase when compared to our Q1. So we're seeing that acceleration across just that financial year, which is great to see from my perspective. And it's our partners who are contributing by majority to this acceleration in these new logos that we're signing, with several major partners fully enabled and onboarded in the year, as shown on the slide there 8x8 and the talkdesk reference there. Our partner programme categorises our partners into four groups. The main ones are integrated partners, platform providers like Genesys who allow resale working relationships with suppliers like us as well as the high growth and very exciting CCaaS and UCaaS sectors. So these are the cloud contact centre as a service providers and the unified communications as a service providers.

30:08 Generally, are highly repeatable integrations, projects quick to deliver and quite a sweet spot for us to a degree. We've got very strong coverage here As we stated, we've got more than 40% of the Gartner Magic Quadrant that is reselling our services now and we're looking forward to those relationships maturing over time. And then we also have solution providers and these are resellers who sell third party telephony or services that go with those and also payment providers because we also work with payment service providers and payment gateways. We may have some integration here depending on the platforms that they're selling, but sometimes it's a bit of a mixed bag. And then lastly, we have referral partners and technology partners who either introduce business to us or provide us with accreditations to their own technology to enable us to sell to their own reseller communities or end customers.

31:08 And in the year, we achieved these accredited positions across all services with major global companies such as Avaya and Cisco, which has already led us to signing several new resellers in The UK and one in Ireland as well. Moving forward to the regional update and just some sort of background on the North American opportunity that we have. The opportunity that we have in North America is well, more specifically The US is the most significant opportunity in front of this business today. It's been the focus of the majority of our further investment in the business following our two funding rounds to date. Focusing on The US alone for a moment because we do business in Canada but particularly it's US where we see the major opportunity.

31:58 As the slide says, the contact centre market in The US is five to six times the size of The UK and The UK is the largest contact centre market in Europe. Three-four percent of the working population of The US works in contact centres and in The US they have over 4,000 contact centres with more than 11 agents. And of those, 37,000 have less than two fifty six. So it's a vast market and with the majority of contact centres in the small to mid sized category, it's really critical for PCI-PAL and the opportunity that we have to scale that we're able to serve that small to mid sized end cost effectively, which is why I keep repeating the light touch cloud channel approach as it is these features of our business model that allow us to capitalise on the true breadth of the opportunity and this is another unique competitive differentiator for us. It's not something that our competitors can easily do.

33:02 While it might surprise you it often surprises people when they tell them this we do have less competition in The US. Why is that? It's a result of The UK market for security and contact centers being a number of years ahead of The US. So our two major competitors in The US are actually UK headquartered companies. So as you can imagine, we know them pretty well by now and we do compete with them from time to time, mainly that's when we're selling direct, less so when we're selling through channel partners. So how did we actually do in the region in terms of North American updates? Well, we're taking a big step forward. I'm really pleased with the progress we've made in just our second full financial year in the region, so it's only our second full financial year there. They've been doing really well since I left, I was actually based out there setting it up.

33:56 It's a fairly short period of time that we have established in the region, but we've made good progress. We've signed 37 new customers, which is nearly double what we signed the previous year and increased the new contract recurring ACV that William just touched on, signed in the year by 125% to just under 1,000,000. GBP 1 And as a result, naturally, our T ACV now sits at just under GBP 1,700,000, which is more than 180% increase year on year. We had some hugely positive and frankly quite exciting sales highlights as part of this, which included signing one of the company's largest ever deals with one of the largest privately owned companies in The U. S, a company that employs more than 50,000 people, so a substantial organisation.

34:52 Pleased to say the customer is now live since the year end and that contract includes recurring ACV of nearly $600,000 per annum, so substantial for us. We sold to a number of other well known brands too, including our largest deal sold in Q4, which was to a well known financial services company deploying our services to more than 700 agents. And we actually achieved this deployment in record time for a large customer too, with the customer going live in just nine weeks from Signature, which was great. That deal as well actually is a really great opportunity for us generally is that the project was for the customer's U. S. Business and they have a substantial European operation too. And it was competitive.

35:38 The customer had already used one of our competitors previously a hardware solution and did look around the market. So I think, all in all, we've done a great job there and there's some real potential with that relationship. We've also had some success displacing competitors more generally and competitors' hardware solutions particularly. We weren't the first in The UK to launch in The US in our space, as I've said before. In fact, that was by a number of years. Those that had gone before us had mainly sold hardware and on premise solutions. So whilst the majority of our opportunities are greenfield, generally, we are finding occasional displacement opportunities with customers that had adopted hardware solutions earlier on. Now with the stepped increases in sales and growth in our key sales metrics, we are naturally now beginning to see some flow through into recognised revenue as well.

36:32 Clearly, we're still in the early days of our U. S. Business, so it's not setting the world on fire just yet, but the trends are moving quickly and revenue contribution from the region to the group increased from 3% in our first year to 11% now. Overall, and it's a question I get asked pretty frequently, we do anticipate The U. S. Business moving ahead of The UK business over the coming years, certainly first through sales bookings and then that will flow through into revenue. And the reasons for that are primarily the market opportunity size there, but also the majority of our large partners are actually headquartered in the territory as well, which will have its natural benefits. Moving to EMEA, which is primarily our UK business. We do have a growing customer base in Mainland Europe as a result, particularly of those global partners proactively selling us there, but primarily our customers and all of our team in The UK.

37:31 The EMEA business has made good progress. Being a more mature region for us given it was where we started, revenues are naturally further ahead and we've seen a substantial jump forward in recognised revenue in the year, increasing 43% year on year to £3,900,000 We've increased our key sales metric of TACV by 46% year on year to just under 5,100,000 giving us that forward looking revenue visibility. This growth would have been a bit stronger, for delays in new sales, decision making that we reported as a result of the initial COVID impacts, with our year on year ACV that we added into the pot, an 8% increase at £1,530,000 As I've mentioned a few times now, we're not the first to invest properly in our market.

38:21 That doesn't just apply to The US, it also applies to The UK. So whilst we're the only cloud vendor with a partner first sales approach, a number of our competitors in The UK had, to a degree, stolen the march on us with regards to working with the sorts of companies we would seek to partner with typically. So at the start of the year, just gone, we set out a competitive displacement strategy in EMEA with respect to prospective resellers across that market. Personally, I like this one, of course, being fairly competitive and this has been a real success for us so far. We've displaced competitors at three important resellers in EMEA, two in The UK and one in Ireland. All three were signed in our second half of the year. One has been onboarded and we already have customers live.

39:08 We've sold through another and going through deployment there. And the third, we're going through onboarding with them currently. All three are major resellers of Genesis or Avaya, both major telephony platforms. And we'll maintain this strategy in EMEA, particularly given some of our competitors have struggled during COVID to deliver projects due to the nature of their hardware on premise solutions that need them to have access to customers' sites, which, as I've said, is not a problem for us. We can deliver entirely remotely fairly easily, which is a good segue onto our operations update. So conscious of time, I'm going to round out the slides soon. Again, really pleased. I mean, as we said right at the beginning, we are pleased with this update. So if I keep saying that, that's why.

39:54 Really pleased with how well the restructuring of our engineering and professional services teams has gone. In its first full year since changes were made not long after I took over as CEO in October 2018. We've taken a big step forward in new customers deployed year on year with 71 new customers live in the period. This is a 154% increase from the prior year. Again, when I took over under two years ago, I was very open with investors that this was an area we needed to improve on. We've obsessed about it and our time to go live metric, TTGL, has been key to this as well as having the whole business on board that it's important. So I'm really proud with this step forward that the whole team at PCIPOW have contributed to.

40:41 And in terms of our TTGO averages as such, we've continued to reduce our average time to deliver by nearly 15% year on year. We've changed the metric this year, providing an average across all projects, no matter what deployment type, so it's a very clear message. Previously, we've provided a range and, as we've stated in our report, new projects which are coming through under our newer processes and controls are delivering even faster, so what we've been doing is working. And actually, a really good example of the improvements we've made in professional services is the large US contract that I mentioned earlier. This deal was won not only through a competitive tender process against our main competition in The US, As if that wasn't enough, it included a head to head proof of concept phase as well, not something we come across very frequently ever in fact, it might have even been the first one. So the final two down selected vendors had to run a POC project head to head whilst being assessed by the customer. We came out of this with glowing colours and having been selected as a preferred supplier, I'm really pleased to say that, as I said earlier, that customer is now live.

41:55 Now, underpinning much of what we do is the security and compliance of our systems, with the highest level of compliance with PCI data security standard and we've recertified across all services this year, as well as continuing our ISO accreditations, which are quite broad but we consider very important, particularly given the size of some of the partners that we work with. To start rounding up the presentation, I wanted to give you a view of my near term focus points tend to do this at the end of these slides so you can see what's on my mind. I think it's fairly obvious that we feel good about the business. We're very excited by not only the prospects but what as a team we're doing day to day. That's very important as a small high growth company.

42:41 When I look back at where we've come from just two years ago, I'm really very proud of what the team here has achieved. To achieve our near term objectives, we've got to capitalise on the channels we've put in place, continue to grow pipelines and increase our sales velocity, the pace at which we sign customers. We must continue our obsession with Time to Go Live and be recognized as the leader in our space consistently for this. And we must continue expanding our partner base. But we will do this in a very targeted and precise way, quality over quantity. But when we do bring on new partners, we're rapidly onboard and enable them to produce. So to a degree, it's more of the same.

43:27 And then just to finish up, in terms of the outlook and the current trading, I'm getting quite a lot of feedback here, Mark, by the way. Don't know if you can control that from your end. In terms of the outlook and current trading, I'm pleased to report that we've made a strong start to the new financial year, of which we're now the majority throughout our Q1. Pipelines are stacking up well currently. We've signed over 20 new customers in the period to date. And also critical to that positive outlook is our continued ability to deliver and given our strong capabilities here due to our cloud product base, we've been able to retain market guidance, as I stated earlier, and we're showing more than 50% revenue growth anticipated in this coming year. You'll have seen from the current trading notes of the report that revenues in the year so far in the first two months are more than 40% ahead of the same period last year. So we're well on track and making good progress to where we need to get to.

44:24 Some highlights since the year end include a really exciting contract with a major well known retailer headquartered in North America. They have stores all over the world and we're supplying our secure payment services to their main contact center, which is in the region with over 1,500 agents. We launched a new product as well, our speech recognition capability for both our agent assist and IVR products, and that enables our customers to choose between accepting secure payments through keypad entry or spoken voice. And similar to my year summary slide at the beginning, I'll round out the slide with further comments on our activity strengthening the breadth of resources available to the Board. I'm personally really excited that we've been able to establish the advisory committee. We announced that, I think, earlier this month, back in the last month. We've worked extremely hard to build the foundations of this business, in particular our market leading cloud platform as well as establishing sizable routes to market through our channel sales strategy. And we must leverage this and capitalise on it and the advisory committee adds a breadth of knowledge to allow me and the Board to plan for the long term future of this business.

45:35 And that about finishes off the walkthrough. So thank you for listening to William and I today. I hope it's been interesting and useful. And we'll now try and respond to as many of your questions as we can in the time that's remaining. Super. Great. Thank you, James. Thank you, William. Now if we could turn to those questions. We have a number of questions that were submitted ahead of the presentation. But please, for those who haven't submitted questions, if you're keen to do so, please continue to submit your questions using the Q and A tab situated on the top right hand corner of your screen. I'd just like to remind you that a recording of this presentation, along with a copy of the slides and the published Q and A, can be accessed via your investor dashboard on the investor meet cap platform.

46:24 Additionally, your feedback is very important. So immediately after the presentation has ended, you'll be directed for the for the opportunity to provide that feedback. If you could do that, that would be gratefully that would be appreciated. While you are submitting questions, can can we have a first look at those that were submitted ahead of the event? We we have covered revenue, cash, and debt quite extensively, but there's one question here that might be worthy of of William Yu just touching on again. The question said, great progress. What visibility do you have in terms of your revenue? Thanks, Tom. Yes. We we we go into the financial year in FY '21 with at least 80 to 90% revenue visibility backed on the TACP number, the the the the contracts I have in the filing cabinet effectively.

47:14 And then add to add to that, the IFRS 15 release. So we have very high visibility going into each financial year, and we hope to have the same going into FY twenty two numbers. Great. Okay. Super. And maybe, James, I've got a couple of questions I'm gonna combine here actually for you, and they're in respect of of capital. You you referenced in the chairman's statement under fundraiser. These additional funds will also allow the company company to consider potential new expansion opportunities in the future. Can you expand on examples of new expansion opportunities? And if I can just combine that with this other question, which is fully drawn down debt facilities this month, Does this constrain limit investment or impede you in any way? Those probably combine quite nicely.

48:06 Yes. Okay, Tom. Thanks. So yes, that was drawn down this month because we had to. That was the deadline. That was the latest we could do it. So actually, purposely planned that we did it then. It doesn't constrain the current plan. It was part of the current plan. So that action of drawing it down was not unexpected. So that was something we planned to do anyway, and it's in line with everything we planned based on the market forecast. And we believe that we can operate and continue to invest in the key areas that we referenced at our fundraise in March. So primarily, those are more investment into North America and also additional investment into product. But clearly, given what's gone on in the world over the last five to six months, we're taking a slightly more cautious view with that investment.

48:56 Our plans today compared to what they looked like looking out in March are a little bit more conservative. But I think all of our existing investors will be pleased to hear that, that we're taking a more cautious approach to it. Getting to the other part of that question in terms of other expansion opportunities. Yes, I mean, again, this does come into play because we are taking a slightly more cautious approach, So we're not going to go charging off down a new opportunity right away without any real care or considerations to what might happen over the autumn and winter with the pandemic. But as we've shown, the business is very resilient to it given the nature of what we do how we do it. We come across new opportunities week in, week out pretty much.

49:44 As a small growing company that works with large organisations, could find ourselves in the position where we have, if I give you an example, a major new partner, for example, and we want to invest more in that to make sure that we capitalize on that scale opportunity into the future. That's in particular the sort of thing on a practical level that might be something that would require us to make some additional investments in the future. But of course, our current sales plans and what we anticipate doing over the next couple of years are built into the market forecasts that are out there. There is another question, Tom, that you could probably link on the end of these which was submitted in advance related to the Advisory Committee and that question was is the committee's focus likely to be directed towards enhancing the yield of the existing contract and customer base or towards horizontal diversification into allied fintech activities?

50:44 Well, what I would say is this week, seeing investors all week, it's great that our investors are picking up on the importance of the advisory committee and it's great to see that that recognized here as well. We've worked really hard, as I said in the presentation, to build the foundation of this business and, in particular, the global SaaS cloud platform that we've got today, you know, the all singing, all dancing SaaS platform. That carries real strength for us from a foundational perspective for scale in the future, but also our channel sales model, so we've got significant access growing to market through these relationships that we're starting to now build. We did state in our report that we are starting to build a new rolling five year plan, but very much right now it's more of the same. But the advisory committee was important for us because it's a very cost effective way actually to ensure that we get a really good breadth of industry experience, just in what we do in security and contact centres, but we touch many other industries as well like payments and fintech and regtech generally.

51:54 So it's just to ensure that very long term that we're looking to maximize the opportunity for this business. But we're not planning any immediate changes of direction or anything because we've still got a lot of potential to realize under the existing plan. Okay, super. Thank you. And we've got a couple of questions. One in respect of a contract specifically, and then we've got some competitive questions, which we'll come on to. But maybe I could just ask you one question here. You recently won a significant new contract to provide agent assist and digital secure payment solutions. Could you give me an idea of the duration of this win from start to end and highlight what you think the reason was behind selecting PCIPAL over its rivals? Okay. So that one, I believe, is a three year contract.

52:43 You will notice, though, that we talk about annual contract values. We don't talk about total contract values. We phased that out about eighteen months ago. That was purposeful. You know, we we are a SaaS business. Our contracts are all rolling. They're very sticky. We have very high retention. So that's why we don't rent mention the the the length of it necessarily because we expect it expect it to renew. But yes, that was a three year contract, and we do tend to lead with three years, but we will go a little lower than that if we have to. The other part the question was why did we win it? Well, think in general, why do we win direct deals like this because it was a direct deal? Because if we're winning business through channel partners, it's often because we're working through the partner as well that has a big factor in that. But when we're winning direct, I'd say it's a combination of things. We're a pure play in our market. So the products that I've talked to you about today are the only products that we have and sell and the the issues that we allow customers to deal with as a result of using those are are all that we're focused on. So we're very simple messaging, and we do that without impacting that end customer's ability to make choices on other areas of their infrastructure or technology that they use in that contact centre and sometimes that's seen as a significant benefit that we're so light touch in that respect. But it also means that our people and our approach is very focused on this specific problem

54:14 and that that is a competitive differentiator for us in in in some respects. So and and I would always say that that our people play a really big part in winning deals. Our, you know, our personality, I didn't talk about it at the start on the about us slide. We've got our values in there, which have been even more important to us through COVID. But we've got great employee retention, very high, and we've got fantastic people in this business that we take great care to hire and we take great care to develop as well. That plays a key part in it. Great. Okay. Just one very quick question here, which I think might be worthy of you just touching on because I think it would hopefully just clear up any confusion. I've got one here saying, surely people are moving to paying for things online and via apps rather than through telephone call centers.

55:04 So although large, isn't your market ultimately going to dwindle away? Yes. Okay. So there's a couple of parts to that. The contact center market, just to be clear, is not getting any smaller. It's actually grown. If you look at the stats on The U. S, it's grown over the last couple of years. And it's expected to hold out. We're not anticipating any reduction in contact centers. So the market itself in terms of the amount of agents and addressable market for us is likely to stay the same. But to a degree with that point, there's some validity in there in that the channel mix within contact centers is changing. We do actually have an appendix slide in this deck, which I think you guys have got access to, which shows you the channel split from some analysis of US contact centers.

55:52 And what you'll see is that there's a digital transformation shift going on in contact centers, but that's actually going on pretty much everywhere in the world that you look. What's happening is your traditional voice engagement into contact centres, is picking up a phone and speaking to somebody or picking up a phone and using an automated service no, it's not that one, it's the next one if somebody's going through the slides. What you're seeing now, as you can see from the slide on screen, is the increasing adoption of so the green section on that graph is email, the sort of turquoise blue colour which is potentially growing the fastest is web chat. So you're seeing these digital channels but what people don't always know is if you engage with a company through web chat or through email or through social media, well, they get handled by contact centers. That's why they're called contact centers today, call centers because they do a lot more than just answering phone calls. And our partners that we sell through, they provide the technology that not only handles the phone calls, but it also handles the digital interactions as well. So, no, we're not anticipating that shift. And then the final point I'd probably make is that something we've seen anecdotally over the last five months is that as far as people going into shops.

57:08 So actually, contact centres have got busier and certainly we're seeing our retail clients being very busy again right now having had a bit of a lull. But contact centres in The UK as well, some areas often are classified as key workers because it was the only way to actually keep communication going. So no, they're still very critical, and we don't see payment volumes slipping away. Great. Okay. Super. Look, we're coming up to the hour. So there's one very last question, which I think is interesting just from a market perspective, and and then we'll then we'll close the presentation. We have a a question here. How much competition do you see with other UK vendors in The US? Can you describe this more? And do you see strong U. S.-based players emerging?

57:58 Okay. So in The U. S, we only have two competitors who are UK vendors. And actually, I would consider there are two main competitors in The U. S. So as I said through the presentation, The UK market was slightly ahead well, slightly a number of years ahead of The U. S. In this. So us and those competitors have been able to get ahead of the game in that respect. So they're the companies that we compete with the most. And then in terms of U. S.-based players coming through, there are a couple, but they are small privately owned organizations that aren't really doing a great deal. So we don't anticipate seeing any large competitors coming into play in The US. And the reason why I say that is because and it's one of the reasons we have a channel model is because PCI is a very tricky challenge to deal with and it could potentially be a fairly significant distraction for any of the large tech companies that you might expect to get involved in this. Know, you could ask the question why don't 8x8 have their own solution? Why don't Talkdesk have their own solution? Why don't Vonage have their own solution? Well, because if we can be easy to work with, they'd much rather outsource that to us to deal with. And that's why we thought that the channel model would work well in this market. So no, it's and we know our competitors report the same that there is low competition in The U. S, and we're not really seeing any new players coming to the market, which is good as we continue to push

59:28 on. Great. Super. All right. Well, look, think that should do it now. So thank you, James. Thank you, William, for updating investors today. Can I ask everybody not to close this session as you will now be automatically redirected for the opportunity to provide your feedback? If you access this meeting from your website, then the feedback page will appear. If you access from a link sent to you by email, you'll be asked to log in to submit your feedback. If anyone has any further questions or would like additional information on PCIPAL, please do get in touch via pcipal@albrookpr.com. However, in the meantime, thank you all for attending. Thank you, James. Thank you, William, and we hope to update you again soon. Thanks, Tom. Thanks, everybody.