RTC Group (LSE:RTC) — Final Results

0:00 Good morning and welcome to the RTC Group PLC Final Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and could be submitted at any time by the Q and A tab situated on the right hand corner of your screen. Simply type in your questions and press send. Before we begin, I'd like to submit the following poll. Now I'd like to hand you over to Andy Pendelbury, Chairman and CEO. Good morning, sir. Good morning, and welcome, everybody. It's nice to be able to present such a good set of results to you as shareholders and take you through the, activities that we've been doing to achieve those results. With me today is Sarah Dye, our group finance director, and Paul Crompton, who's managing director of Ganymede, which represents the majority of the sales in the group. We have an international business, which the chap who runs it answers directly to myself.

0:55 So we'll take you through the, the presentation, and then we're gonna do some questions. So, look, our results, in a normal year would be considered very good looking at the state of The UK economy in 2025. But actually, given the significant increase in costs driven by the government's national insurance and minimum wage, our results are absolutely excellent. To have achieved the same level of profitability is testament to the teams of people that we've got working in the group. So absolutely very, very pleased about the record profits being maintained.

1:42 Our balance sheet has continued to grow. It may have only grown marginally, but in the same time, we have significantly increased our cash. And through our policy to do our share buyback, we were able to increase our earnings per share significantly as well. All of that results in the position we find ourselves where, yes, again, we're able to significantly grow our dividends for our shareholders, which I'm sure is always very welcomed. And the the key thing for us as the directors of the business is the strength of the group isn't about how we did in 2025.

2:27 It will be how we do in 2035 and the lead up to the next ten years, and that's all about your order book. It's all about your relationships with the clients. It's all about how we invest in the industries that we support, and it's how we can guarantee, at best, long term revenue streams for for our shareholders to be able to enjoy. We have continued despite, the pressures that have been placed on businesses this year this last year to invest in our workforce and by work by investing alongside our clients. And in many cases, we don't just invest in our own workers. We train some of our clients' workers in parallel. That's ingrained the relationship of partnership with our clients across quite a few of our sectors.

3:15 So all in all, an excellent performance in a very challenging year. We are quite clearly now a leading specialist in recruitment. We're not a generalist. We're a specialist. When I'll talk a little bit about the business model and how we've changed the shape of the business since I took over as CEO and then Lathalie as the chairman. But the key change was all about moving our business into the infrastructure sector so that we could be in long term revenue streams of rail, energy and more latterly water, where we now deploy well over a thousand people a day. The sectors that we are in are set to benefit significantly from the government's long term infrastructure investment plans.

4:08 And in fact, I think in the last few weeks, the government's pipeline of contracts has been released, which is showing us a minimum £750,000,000,000 of investments that they intend to make. All of this enables us as a recruiter with our long term order book to be able to give our engineers, our employees and our shareholders a lot more visibility about our future in the rail maintenance, rail renewals and continuing government smart meter initiatives. So our business model is very diversified. And as I say, I think I'll show in another slide about what we were and what we are now.

4:54 But the idea is we have three main groups of the parts of the business. We have our Ganymede business, which is the business that looks after our rail and our smart meters and our water. We have our international business, which has been involved, especially in the last few weeks, in some very interesting activities. But our international business that's been as broad as having 3,000 people working in Afghanistan, we still currently have people working in Iraq, we still have people working in Mogadishu, we still have people in Bahrain. And, of course, it's been a challenging few weeks for the for The Middle East. But our business is is strong, and we support that with our manufacturing business, which was the traditional and original ATA business, whereby our engineering people will work alongside some of the country's biggest manufacturers. We work the last Toyota. Again, I'll show you some clients shortly.

5:53 But the three businesses interlock, and in the middle of the whole thing is our DCC, the Derby Conference Center, where we're presenting from today, which was the home of, Network Rail's training. Over the years, it has hosted some of the biggest conferences across rail, across energy, and across many, many varied, sectors. And it's our headquarters as well. I mentioned about the shift in focus. So one of the the key concerns I had when I took over as a CEO was the fact that we were exposed in a number of very worrying ways for me. One, we were predominantly a permanent business. And all the business needed was a recession, and it was in trouble, and it got one.

6:44 So I set about changing the team of people, bringing people in that could help me move the business away from that exposure and to develop a more contract, a more robust business that would be long term based. And as you can now see, well over 80% of our revenue comes from contracts, which is more secure. From a risk profile, the majority of the clients when I joined were SMEs, the lifeblood of the The UK economy, but also the the the riskiest part for recruiters. The number of recruiters that suffer bad debts because small and medium sized enterprises, you know, many trying very hard to survive, don't survive.

7:36 And the recruitment industry takes took a big knock from that sector. And I wanted to move us to the larger organizations, the the far more blue chip international. And, again, we're now in a position where just under 80% of everything we do is with a blue chip or government based organization. Again, when I first joined, we had no order book. We had a very minimal number of preloaded orders for permanent requirements, but we didn't have an order book. As we sit here today, we have a significant and growing order book, it's that that enables us to make investment decisions. It's that that enables us to work alongside big clients as to look at their five, ten, fifteen year plans and to invest alongside them.

8:31 As I say about The UK sector spread, we've moved significantly away from the manufacturing as our core dominant industry target very much into an infrastructure based approach, which is where we now see ourselves sat with most of our clients. So it's quite a good revenue resilience through good management strategies. The diversity of our infrastructure led portfolio is is there to be seen. A large chunk of what we do is in rail. When I took over, we had around about six engineers working in rail. Our at our height, we have nearly 2,000 engineers in rail. So rail is a very, very long term prospect going forward as well as current and past.

9:28 I know there's been a lot of concern in industry about how is the government gonna be able to afford to keep investing in rail and some of these infrastructure businesses with the war that's potentially supporting and and being affected by in in The Middle East and other things with the the Russia and Ukraine war. But the simple truth of the matter is the government cannot afford another potter's bar. The government cannot afford another Hatfield, and therefore, maintenance and renewals has to stay a significant profile spend for this government. So it will. Energy and utilities, well, we we know the the the state of some of the the water industry and some of the the mess that they're trying to sort out themselves, and we're increasingly getting involved to help them by providing people both at a conceptual stage and at a an operating stage as well.

10:29 So that energy and the utilities is gonna continue to grow. And the water is the same. The environment is small today, but growing. Transportation is something that we are we are in. Some of the things we do in transportation, which people don't really see, but what they're doing is if there is a a problem at one of the major stations, train stations, and they bring in a number of high volume support staff to help customers find their way around, well, we we provide the teams of people that are on the platform doing this. And there's more and more outsourcing of this activity coming from the government and from their franchises. Manufacturing is 11%, and our highway construction is is not one of our biggest, and it it really never has been, but it's we do we do a certain amount of it. So a very diverse infrastructure led portfolio.

11:29 And our client base is very broad, and it's very strong as you can see it there. But we we, you know, we're with the biggest energy players. We're big we're with the biggest rail players. We're big with we're the we're the biggest international outsourcers, and we're with some of the biggest manufacturers in the world. So we have really good branded trusted partners that we work alongside as leading clients. I think to add to that, Andy, well, a lot of these clients, whilst we initially maybe started working within rail, they operate across energy, water, infrastructure sectors, and one of our successes has been sort of broadening our supply across basically the the various silos within these businesses. So I think it's a great opportunity to further develop that with these key clients. Good point. Yeah. Awesome. So I'll pass you over to Sarah who will now take us through the key financials.

12:31 Good morning, everybody. This first slide, I'm just pulling out some of the highlights key performance indicators from the annual report and from our results announcement. I think the key points to note here are that despite a challenging year, we've managed to maintain our gross profit levels and our EBITDA. But at the same time, we've increased dividends per share to shareholders and overall increased net assets and net cash. So those are the key messages. If Paul, you move to the next slide, we can just drill down a bit more. So looking in more detail at our income statement. Revenue overall slightly reduced. Within that, we have had, as Anders alluded to, like a slightly sort of challenging year in Rail in the government infrastructure spend that we're all hoping will come through has not really been coming through.

13:24 So rail not quite where we wanted it to be. However, energy and recruitment and other areas of Gamma Mead have done very well. And that's a slight over performance from them has offset slightly lower performance from GSS and DCC. And obviously a challenging perm recruitment environment that the whole you'll be aware of from other recruiters' results. And Sarah, can I just jump in on what you were saying there about it? Just in terms of some of that revenue, the especially on rail, we're currently in control period seven, Paul. Correct? And that period runs for another Couple of years. Couple of years. So there could be a backlog of spend that's accruing that has to be spent by the government. So we're hoping that towards the latter part of this period and each CP, each control period sometimes has a very big beginning, a a quiet middle, and then a a busy end, or it could be the other way around. I think we're hoping this time for that that will start to to come through.

14:27 Yeah. Yeah. It's been very minimal spend or particularly around enhancements throughout the control period, and we're hoping to see a slight change towards the end of that, as you said. Thanks, Sarah. Okay. So just to recap, obviously, Andy's shown that we have a diverse business model. And that means that we provide a varied range of of late recruitment and labor supply solutions. So we're slightly different from your traditional recruiter. So within our cost of sales, we have obviously, the majority contract wages, but we also have a significant amount of direct costs relating to where we're providing labor solutions rather than just a perm recruitment or a contract recruiter. So that will include things like our fleet, our training of our engineers and rail people, equipment and workwear, for example.

15:18 So that's what we've done is we've managed really tightly those direct costs in line with our revenue, which has enabled us to maintain those gross profit levels. What I have set out on the sheet is also a net fee income. So net fee income is purely the perm revenue and the contract margin, which is revenue from contract placements less there by ages. And that's the number that other recruiters who don't have our mix will report on. But I thought it was useful to put in here to give some comparison. It also shows up in our conversion of net fee to profit before tax compares very favorably with some of our peers. So just thought that would be useful. And then looking at administrative expenses, again, we've managed to hold them steady despite, as Andy's previously said, significant increases in national insurance levels.

16:17 On the balance sheet, overall, as Andy said, we've increased our net assets. A little bit of background. Non current assets predominantly relates to the right of use asset, the lease relating to the Derby site. We have a seven acre site here. We have several buildings which are let out. And we have a hotel and conference center. And that's what feeds into the revenue for the Derby conference center, which is The UK segment, the central services segment in our annual report. Highlight of the balance sheet is the reduction in trade and other receivables and subsequent increase in cash and cash equivalents. This is really down to excellent work from my credit control team.

17:05 And it's a combination of getting through backlogs of aged debt where things become more difficult with some of the larger clients. The process is very convoluted, collecting in the aged debt. Once it becomes old, it becomes more difficult. But the actual levels of aged over thirty days are now like we're at one hundred and seventy five thousand compared to about a million at the end of last year. So that's a real improvement. There's also amongst sort of four key clients as timing of payments and just overall improvement in the way we work with them to manage the application process and getting cash in more quickly. So the cash flow bridge shows really what we've been saying, how we've generated our cash and then how we've applied it for the benefit of shareholders.

18:07 One of the things that if you could just go back, Paul, I did want to mention, with the cash and cash equivalents, obviously, you'll see that whilst we have an invoice discounting facility available to us that we use throughout the year depending on timing. The fact that we have no term debt on our balance sheet means we're pretty well placed. There's rumors that interest rates will be rising. We're sort of fairly resilient in that respect given the position that we're in with no term debt. And you'll have seen from our income statement that we're fairly well covered on the low levels of interest that we have been paying. Thank you, Paul. So, yeah. That was me. Okay. So I'm gonna talk just briefly about the areas where we see growth opportunities within the business. And as we detailed earlier, we operate across a wide range of sectors, but infrastructure really is our largest sector and and our our most prominent market.

19:10 As Andy touched on earlier, the government have recently updated their infrastructure pipeline, which shows just over £700,000,000,000 of investment over the next decade on capital expenditure within the infrastructure. And, obviously, a lot of that is within the core sectors we operate in with rail, water, and energy being three of the biggest areas where the investment has been forecast, that obviously gives us a long term pipeline view of demand and and helps us look at growth opportunities across the next decade. So alongside the, infrastructure sector, we also are heavily involved in manufacturing, which makes a real strong perm baseline under the ATA brand. And we support clients in areas such as fast moving consumer goods, automotive, aerospace manufacturing, alongside things like construction materials and food manufacturing.

20:05 So having that perm baseline, also complements well the the contract area, which is predominantly where infrastructure sits. We do a small amount of permanent recruitment within infrastructure, but the bulk of it, as Andy touched on in the sort of move towards a contract led business, is is within contract and temporary. So I just wanted to talk about the the the main three areas where we operate, presently. So within the infrastructure, we're operating in growing regulated markets where the sort of demand is underpinned by the long term investment we just took touched on around the infrastructure pipeline. So if I just start with rail, this is our most established, business area.

20:52 We've been a provider to network rail for getting on for two decades now. We're a primary supplier. We supply a significant amount of staff to support their maintenance and renewals activities. And and as Andy touched on, we also support a number of train operating companies with train preparation, with customer service, staff, and gate line services. So it's it's a quite diversified offering across rail. So alongside network rail, we also support the majority of the tier one contractors who are out working on behalf of network rail, delivering renewals, enhancements, improvements, etcetera, throughout the c p seven. And we offer a multidisciplinary capability, so across blue collar, white collar, and gray collar, and we work across track, signaling, electrification, and and civils.

21:42 So it's a very established business, long term, well respected within the industry. And if we move on to energy, really, we're an an outsourced workforce partner. So this isn't traditional day to day recruitment. We provide a solution that Sarah touched on where alongside providing people, we're providing the vehicles, the, tooling, the uniform, etcetera. And we we sit alongside our major utility partners, and we also manage health and safety, quality compliance. So it's really a one stop shop for these utility providers who can come to us, and we we basically supplement their workforce with our own. And and within that, we're supplying smart meter engineers, gas, electrical across both domestic and commercial.

22:31 And to support that, we've also, introduced our NSAP accredited training center based in Milton Keynes. So this allow us to upscale, rescale, and train our own people. And we also, as Andy touched on earlier, train client, employees. So people come to us to our to our training center, and we offer those training services to third parties. The last major infrastructure operational, it's touched on, is water. So this has been a real success story over the last few years, and and we've seen quite a bit of growth in water. And with the AMP eight delivery cycle, which is proposed to spend around a £108,000,000,000 investment, with in the first year of it at the moment, we see potential growth further. We we supply, a number of clients, and and it's quite white collar focus at the moment around project management, engineering, commercial, and planning professionals.

23:29 And this this area, a lot with AMP eight and and AMP nine beyond that, we we think we're really well positioned, and we're developing clients, within these areas to to see future growth in the water sector alongside the investment the government are making. Okay. I'll pass back over to Andy just to run through the final few slides. Thanks, Paul. Shareholders are why we do this. Our shareholders are the most important stakeholder in our business. They're the people that invest with us. They're the people that believe in us, and have a very strong shareholder base and a good relationship with our shareholder base. And we have always had as a prime goal, a prime strategy to get to the position where we can prove a very strong underpinning balance sheet that gives us the ability to pay money out.

24:29 And I think, again, with the proposed dividend for this year, we will have paid over approaching £2,500,000 in dividends over the last three years. The increase this year, again, will be a 10% increase to the dividend. And the yield that we will have delivered on average over the last three years of around about seven and a half percent with a very strong dividend cover. So actually having that progressive dividend policy has has always been a bedrock of what we've tried to do. The other thing which we have been doing, as I mentioned earlier, Sarah had mentioned, is the fact that we have taken the opportunity to buy out shareholders who have been with us for a long time, but for whatever reason have decided that the timing was right for them to capitalize on their their their investment.

25:26 And and how we've done that is we've done that so that every single shareholder in this group benefits. So all of the shares that we bought out, which probably was approaching 2,000,000 shares, were bought at a discount of 15% to the market. Thereby everybody, not just one particular group, benefited from what we were doing. So we've got less shares. We've got stable profits. We've got no debts. Whatever invoice discounting facility or working capital facility we have is the most, superb arrangement negotiated by Sarah, which, people today would not be able to get the arrangement we have. So respect to Sarah and her team for negotiating such a strong working capital arrangement with our banks. So we're very solidly based to be able to return money to our shareholders.

26:23 And what personally makes me proud is the fact that across many metrics and across over many years, I truly believe the management team that I have assembled and the board of directors that I've brought together have constant have constantly beaten our peer group. And when I look at our total shareholder return, it's been consistently positive. And remember, we've we've endured a very deep recession in this period. We've gone through a financial crisis during this period, and we went through a pandemic, a pandemic which overnight closed the whole of our revenue stream for two of our businesses. And we still survived it, and we're still growing back from it. And that says a lot about our people.

27:09 And it's worth noting that since I joined and brought the management team together, we have over 50 people in this organization that have been with us for over ten years. And of that 50, there's 25 of them have been with me for over fifteen years. And of that 25, there's 15 of them have been with me for twenty years. So we have inbuilt experience. We have incredible knowledge. We have a culture which has been ingrained over many years, and all of this is what enables us to be able to work as a team for our shareholders to make sure they get a return which cannot be beaten in our sector. In terms of our growth strategy, well, we constantly had organic as one of our main thrusts.

28:02 I have strongly invested with the key people to work alongside their clients to make sure that we expand both within and across clients to give them a broader spread of capabilities. Our end we continue to expand our client base. If you do a great job with a major player, you usually find that other major players want to know how you've done it, and they wanna be a part of it, And which is hence why Paul is and his team in energy are number one with both Volvo and EON. Most people would be pleased to be a supplier to either of those blue chips, but we're number one with both of them. And in terms of international, I remember when I built the international business many years ago, people thought it was a a one trick pony, that all they did was supply people to Afghanistan.

28:55 And that business has continued to show that its capabilities of having a network in over 20 countries, it has ingenuity built into it. Diego Garcia, the only aircraft that can get into Diego Garcia was Sea Charlie's, and they came from Bahrain, and you could possibly get six or seven people to fly in. And then we were the only company anywhere in in in the world that has met been able to persuade them to let us take in or at least aircraft, an a three twenty, that we took a 150 people in. We've provided over 600 people now into into that site. And, we, at the same time, you know, winning new contracts, we now have Poland.

29:45 And, of course, The Middle East is a a a key issue. It's a key concern. It's a key worry. It's a key worry from a domestic point of view. And primarily for our people who are working internationally, they're our prime responsibility. And, what we're controlling and what we're trying to do is make sure they're safe. But following all of these interventions, all of these wars and disputes, there's usually a rebuild period. And our international business is very firmly placed with key players to be involved in the rebuild, and that can be five years, ten years, fifteen years. So we're well placed from an organic perspective there. From an acquisition point of view, well, I have watched our sector destroy shareholder funds, and in certain cases, wipe out shareholder funds at the altar of acquisitions.

30:43 We've been very cautious not to overpay or to overexpand, and we won't do that. We won't do that to our shareholders. We have made one key acquisition in the energy business. And when I bought it, it was turning over about 4,500,000 and generating 2 to £300 of contribution. Last year, it was 2,000,000 of contribution and 2,000,000 of contribution on a basis of nearly 20,000,000 of revenue, five times our investment. So that was what we're looking for. They're not easy to find. And within our free cash flow, we believe there may be opportunities that are gonna rise out of some of the turmoil in The UK marketplace that we will be looking at.

31:35 And, of course, most of this is driven by how do we manage the business for for you, the shareholder, with the market sentiments as it is. Yes. There are some significant concerns. As we can see, December saw the sharpest fall in recognized for a very, very long time. But, also, if you look at purchasing index, very low. If you look at the the costs the government's having to consume themself just on debt management, You look at where the spend is gonna come from. It's it's a it's a key concern. But there are more candidates on the market, but there's less candidate demand.

32:24 Employment legislation is not gonna get any better. The new employment bill, which I believe is constantly being backtracked on and watered down, will still come in. And what I am proud about is many of the terms and conditions that the government's trying to impose through this employment bill, my organization has been doing for fifteen years. We've always treated people with the respect. If they're gonna come and work and to create value for us and for you, the shareholders, then they should be treated properly. So, actually, we we I we have nothing to fear by this bill. From an opportunity's point of view, yes, the regulatory rail spend, has was down, but it's gotta go up, and they have to. It's a key thrust of this government's strategy is to get people on the trains.

33:22 So, yeah, they they've gotta work their budgets out, but they they're committed to spend. And as Paul alluded to and I did before that, you know, the pipeline has now been announced, and that pipeline is over 700,000,000,000. And it bodes well for a business like ourselves who is investing alongside major clients. The outlook the outlook started very well this year for us. We we we we started the year quite strong, and then the and Iran happened. And there's been a big change as you probably all know in in a lot of people's sentiment. Give you an idea on costs. Just in the last two weeks, the run rate of paying for fuel for people who use our vans to go and do the work for our clients would be running at £25,000 a month more if this thing doesn't get resolved.

34:25 I think was on this morning turning around and saying if it goes to a 150, a barrel, it'll be a global recession. So let's hope for everybody, that things can change and that there can be a settlement settlement of people's nerves relating to what's gonna happen. But our underlying and long term demand is very, very strong. We announced a contract a couple of weeks ago, Paul, did you, which was into 20? Yeah. Yeah. With the SRE. The SRE. Eight year contract. An eight year contract. We believe that we are, close to, securing some new work that we'll be announcing.

35:11 And our key partners are working with us to understand the pressures we're under because they understand that we're a major part of their clients' success. So we have a very strong relationship. And and the and the the main thing for me for for for you, Shell, is just the fact that the board of directors that I brought together, Paul's experience in his sector and his knowledge as an engineer is second to none. Sarah and her finance team have provided to this group, I think, a level of financial mechanisms and wisdom that many another company would have would have liked over the past few years.

35:57 So with that, we secured a very strong nonexecutive in XPOVIO, and we're we're we've got a process in place. And I think we're getting close to finding another nonexecutive to join us. We have very good governance, very good board of directors with the right experiences, and I think we have a very strong outlook. Thank you for updating investors today. Ladies and gentlemen, please do continue to submit your questions just by using the q and a tab situated in the right hand corner of your screen. For your reference, a recording of today's presentation will be available on the Investor Meet company platform shortly after the meeting has ended. As you can see, we received a number of questions during today's presentation. If I could please just hand back to you to read out the questions to give responses where appropriate to do so, and I'll pick up from you at the end.

36:49 Okay. So I'll just look through the questions and read and distribute accordingly. So the first one is you say the rail sector has been sluggish, but can you be a bit more specific? I suppose better answer my own question with this one. So so, yes, the rail rail sector has been sluggish, and I sort of intimated during the presentation around that. CP seven has seen a much more focus on maintenance and renewals activities and less activity around enhancements. So outside of the big projects such as HS two, the Trans Pen Iron route and East West Rail, the actual enhancement budget seems to be very constrained, and it's it's quite well publicized with a lot of the tier one contractors as well. So as we said earlier, we see it's been tough in the the initial parts of c p seven, but we're hoping towards the end that a bit more spend is released in that enhancement area.

37:51 But where we are strong is a a lot of our core focus is around maintenance and and renewals works, which whilst renewals have seen a slight dip, the the maintenance levels are has remained relatively steady. Okay. I'll move to the next one. How will AI impact your industry both from the demand and from the supply side, and how will it affect your company? Is this you wanna take, Andy? Yeah. So AI is a very interesting subject when it comes to recruitment. You know, you look at universities recruiting candidates to to to go on their degree programs, and candidates are now submitting, their applications based around an AI machine giving them, the information to be able to do it.

38:43 And how the university is defending themselves is by creating AI to be able to find out who is using AI to answer their questions. A little bit is that's the same for us in recruitment because, obviously, a generation of CVs and for people to come in to to register with us It is very much on the rise. But we've spent quite a lot of money in this group developing our platforms of of of IT, and built into that is the capability for AI to sift out maybe where a generic answer or a generic skill may be being used. But I don't think we can hide away from one thing.

39:29 There are certain parts of the economy which is in trouble in terms of being affected by AI, and quite a large amount of, white collar roles, are gonna be challenging. In fact, there was a a report done recently which talked about where do they think the key industries would be affected. And I'm actually quite pleased that the sectors we have chosen to develop, that actually the majority of work that we do, probably a robot couldn't do. You know, the maintenance work we do, the renewals work we do, the going into people's homes and changing their smart meters out, the the the smart home of the future. The AI may help drive the home the home be smarter, but we have to put the technology implemented in there for it to happen.

40:18 So I I'm actually encouraged from a, RTC group perspective what AI can do, but I can see many reasons why many people will be worried about where it's going to affect, some of the big recruiters. I could just chip in from a back office point of view as well. What we're seeing in HR is people are just going to AI to generate letters if they want to complain about something or raise an issue. So I think there's gonna be more and more work for HR departments and people being behind the scenes where people are just generating these letters. They probably don't really understand them, obviously, we have to then respond to them. So Okay. It's gonna affect everything. Okay. I think the next one, you touched on a little bit, but what is the effect of the war in Iran on your prospects?

41:08 Broad question. Well, I think as I mentioned, the the the first and foremost concern for us was the welfare of our people because we had people in Bahrain. We had people in Iraq. We have people in UAE. We have people in in many countries. We have people on Diego Garcia, although it's not really been affected yet. So from a a safety security point of view, major concern, I can advise you that all our people are safe. From a challenging perspective, it's been a little bit crazy for us because some people would have been away on rotation, and they were due to go back to work and, you know, there's no hiding that Dubai as a major hub had been closed and lots of aircraft fly in and out of Dubai to the main places.

42:01 So that's been a challenge for us, but it's a challenge that we can handle because when we were exit when the Americans exited Afghanistan very quickly, my team was one of the last teams to leave Kabul Airport where they spent most of their time shredding information of local people that had worked for us, 800 locals, so that the Taliban couldn't get the information on them. So my people are extremely diligent. My international team based around the world have worked with us for many, many years. I'm very confident that behind every crisis, there'll be a rebuild. And I think we are with the right companies, and that could be a year away, two years away. We're already in discussions about, some activities in Ukraine and and and potential rebuilds.

42:57 So there's there's lots of good behind the sadness of maybe what is going on at this moment in time. K. Thank you. The next one is why are there no published forecasts for your company, and when do you plan to reinstate them? Yeah. So we back in 2018, 2019, we we did have forecasts out in the city. We have research done. We sort of put that all on hold during COVID, as probably many people did. And then there was a period following COVID where we had a transition of our major contract and everything. There was still a lot of upheaval and turmoil. We are now proposing to put forecast back out as part of our efforts along with this forum to increase shareholder engagement.

43:49 So you can expect to see forecasts within the next month. We're working with our brokers use to provide those. Thank you. Do you have any plans to replace the nonexecutive director who stood down before Christmas? Well, yes is the answer to that. But we have been going through and are going through quite a detailed process to find the the right replacement. Yes. There are not there are none executives. A plenty. Many of many many executives who have been on boards, the the the the right for for all businesses, they're not.

44:37 And what we do is very specific, and it has a specialism behind it, and and it has to be understood. And, actually, bringing the wrong nonexecutives onto the board can be more damaging than not having the nonexecutive on the board. So we are absolutely committed to governance. Look. We have Zeus as our brokers. We have a very strong nomad, and all of these companies and we have very strong legal team. And all of these companies do their own vetting on us to see whether or not they want to represent us. And all of those companies like representing us. They they see a a strong government belief in this company gov governance belief in this company, and and we have it. Now there was a huge turbulence when Bill Dewey died.

45:33 Bill and I have been together. We joined together. Sorry. I joined him to and together, we built this business as it is today, which is very different than the business that it was. And get the dynamic that Bill and I had together was very strong. And having that relationship in place is important, and having the dynamics on the board is very important. We will have another nonexecutive. I'm hoping it will be very soon, actually. And our commitment is to you, the shareholder, to be governed right, to perform well, to deliver you profits, and to make sure that we have a long term future together. Thank you. Okay. The next one, you achieved a significant improvement in working capital last year. Is this a structural improvement or merely a timing which could reverse again? And the second part of this question, in terms of use of cash, I applaud how you bought back very cleverly at good discount.

46:31 Will you continue to seek such opportunities? It's maybe a question that's split in two halves. Yeah. I think if I if I take the first thing. So in terms of the working capital improvement in the debtors, I think there's two parts to that. There was some aged debt that was very stuck. And we've worked really hard with some of our key clients like Balfour Network Rail, Balka Colas to clear all that backlog and to get to a clean position. So I think that's like a hard coded improvement. I think there's this element of timing also, but we have got very strong credit control processes in place. So I would you know, our debtor days at the end of December were 31 compared to 43 the prior year. So that's a huge improvement. But, you know, I'm not naive.

47:18 These things do change. It only takes a client to have few of their receipt as leave. Then, you know, things can get backed up again. But Network Rail have really improved their processes. We've worked with them a lot. So I think that will stay clean. I think there'll always be little bits of things that get stuck. But I would I would hope there's a definite improvement. But I would hope at the end of 2026, the debtors is higher because we've done more revenue. So so I hope that answers the question. And did you want to Do you want me to read the second part out again? No. No. I I think I get the gist of it. A straightforward answer is yes. If if a shareholder who acknowledges that we our sole responsibility is to all our shareholders, not one particular shareholder or group of particular shareholders, wants to consider releasing their shares. And we have a policy approved by the shareholders to buy back shares.

48:19 So, yes, we would do it. But I would remind everybody that the use of the balance sheet to do that then has to be considered with what other uses have we got for the balance sheet. So it it may well be that we bought those 2,000,000 at a time where that was the best use of shareholders' funds. It could well be that, you know, an acquisition may come up, which I could use the funds for. But generally speaking, I would consider buying people's shares, but I'm not gonna overpay. And I want people to be on my shareholder register who see the long term benefit of RTC and wanna be on the journey with us. I'm not looking for people who wanna come in and make a quick buck on us. That's not what shareholders want. And that's me being honest with you. Okay.

49:07 Okay. We're running out of time. We've got one more question. What should be the annual increase in revenues when the expected rail business does come through? I suppose I better take this one. So to answer your question, it it's quite hard to to predict. As I said, the the maintenance and renewals business generally, maintenance has been steady. Renewals has taken, somewhat of a a dip. So, we're hoping that the enhancement works come through, but, obviously, with with all these things, it's not guaranteed of the network rail operate. Whilst they're in a control period, they also operate on annual budgets. So I wouldn't want to sit here and and put a prediction on it, but we're we're hopeful that the potential revenues around the enhancement side of the the business will increase over the next couple of years.

50:00 Okay. Well, I think we've, hit our time limit. So we will also review any of the other questions that have been raised and potentially respond online, but thank you very much. Thank you for answering questions from investors today. Before we ask investors to share their feedback, which I know is particularly important to you and the company, Andy, could I please just ask you for a few closing comments? Yes. Certainly. Look. A very, very promising year in a very difficult environment, a very promising future in a very uncertain times, a very good company in a very difficult marketplace. That's who I think RTC is. As your chair and CEO, I own as most of you will know, I own a fair chunk of the the shares of this company myself, and I'm proud to own it.

50:57 The journey I've been on to turn this company around and to build the team that I've got and to deliver a future for people to want to be a part of is what drives me. And, I will be doing this with you guys and for you guys, for the foreseeable. So thank you for being a part of it. Thank you once again. Could I please ask investors not to close this session as you'll now be automatically redirected to provide your feedback, which will help the company better understand your views and expectations. On behalf of the management team of RTC GROUP PLC, we would like to thank you for attending today's presentation, and good morning to you all.