Sdi Group (LSE:SDI) — Final Results

0:02 Hello, and welcome to the SDI GROUP PLC final results presentation. Throughout this quarter presentation, investors will in listen anyway. The questions are encouraged, and they can be submitted at any time by the q and a tab situated in the right corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question received in the meeting itself, but the company can view all the questions submitted today and publish responses where it's appropriate to do so. Before we begin, I'd like to make the following poll. I'd now like to hand you over to CEO, Steven Brown. Over to you, sir.

0:29 Thank you. Hello, and a warm welcome to SDI GROUP financial results for the year ending 04/30/2025. I'm Stephen Brown, CEO of SDI GROUP, and joining me is CFO, Amit Sharma. Today, we'll walk you through our group summary, provide an operational overview, present final results for FY '25, and discuss the outlook for next year. At the end, we will, of course, open for q and a.

1:07 First, let let me introduce you to the SDI GROUP and force our business model. First and foremost, we are a buy and build group with currently 17 established businesses and roughly 500 employees operating 19 locations worldwide. And in FY '25, we achieved a total group revenue in excess of £66,000,000. We operate a decentralized model that fosters autonomy, independence, and agility. Our focus is on high growth, scientific and processing niche markets, and we have a pro proven strategy for combining organic growth with acquisitions, having made 20 since 2014.

1:55 With our operations being geographically diverse, 47% of our direct revenues are generated from overseas markets. Indirectly, overseas revenues are much higher due to our strategic distribution channels, although our exposure to The US is low at around 10%. Importantly to our strategy, our buy and sell model relies on a compounding cycle of growth. Our business model is in fact our group strategy and focuses on two key pillars, organic and inorganic growth. Our organic growth strategies include synergies, collaboration, operational excellence, and investment for growth.

2:42 Cash flow generated from organic activities feeds into our inorganic growth where we seek to acquire complementary profitable businesses in these markets, and this feeds back to create a compounding effect. We are, of course, driven by efficient and effective capital allocation. Now to provide a bit more detail on what we delivered during the year.

3:15 The year has been focused on executing the refined strategy outlined last year Almost a year of significant strategic progress where we delivered a solid financial performance and started to see our plans come to fruition. We continue to facilitate knowledge sharing and synergies across the group, supporting portfolio management teams to deliver. Our growth continued to be supported by strategic acquisitions this year, and we significantly delivered three excellent acquisitions since we reported loss. These include Inspect Vision, Collins Walker, and post period end Southern Thermal Solutions. I'm pleased to report that our business model has demonstrated resilience against the backdrop of challenging and uncertain global conditions.

4:12 I would now like to add a bit more color on some of our key organic growth initiatives. We focus on leveraging the sum of our parts, identifying opportunities to improve efficiencies and market access across the businesses. We have continued investment into r and d and new product launches driven by customer needs in response to market demands and requirements. There would be many collaboration initiatives. For example, we had a powerful presence of prestigious Lab Innovations Expo, bringing six companies together to promote a unified product offering. And we delivered collaborative products and contracts, including Fraser and Monmouth, Attic and Synoptics, Collins Walker and LTE, and Severn and ATC.

5:05 We have improved knowledge sharing across the group. To give some examples, we're delivering value from our group marketing function, and we recently appointed divisional managing directors for two of our divisions to improve capacity, capability, and resources for driving organic growth.

5:27 Let us now lift up our operating divisions in turn. First up is our industrial and scientific products division. We've seen solid performance across the division with total revenues up 10% to an excess of £25,000,000, including Inspect Vision who met expectations. I would like to call out a few highlights. For Alec, performed well post restructuring work in 2024, this year seeing consolidating operations to one site in Lisbon. Fraser's growth was underpinned by increased product awareness in broader markets. We also had a number of new product launches across the division, in particular from ATC, who focused a sustainable product offering due to regulatory market demand, in particular from The US.

6:20 Anatic launching is the most advanced CMOS camera for demanding applications such as neutron imaging and astrophotography.

6:32 Now let us look at the industrial and scientific sensor segment. We delivered revenue growth of six percent to £17,000,000. This was largely driven by solid performance from SendTech, increased demand from new and existing customers for both established and bespoke solutions, and a strong capacity for market expansion. Also, Chel delivered

6:56 and continued to perform well with an expanded product range. And NEPB with notable growth in end markets, which has driven growth in the period. And finally, let us look at the laboratory equipment segment whose total revenues in lab equipment decreased 11% to £24,000,000. This was primarily reflecting challenging conditions in the life sciences and biomedical markets. I'm pleased that the organic initiatives we had implemented in some of the segment businesses started to have impact driving recovery in the second half of the year. CFL had an exceptional performance through contract momentum. In addition, they delivered a significant government contract award for delivery of high quality film covers.

7:48 Monmouth had its largest ever single clean room contract, although this was this will be delivered in f y twenty six and is now linked to the new SDI implemented strategy for refocused product offering at Monmouth for higher value products. As expected, there were numerous new product launches across the division, including LTE's new range of autoclaves with a focus on sustainability, smart performance, and safety, and Synoptics delivered a focused compact imaging system targeting smaller laboratories.

8:27 Moving on to our inorganic strategic development. I would now like to talk about our new additions to the group. As mentioned earlier, we've seen three earnings enhancing acquisitions since we last reported in line with our key criteria, firstly, SPEC Vision. SPEC Vision is an excellent acquisition, bringing to the group significant technical advancement with AI and ML capabilities. They remain autonomous whilst exploring international and with the market synergies with Fritz around the static. They manufacture precision measurement for smart manufacturing, automated inspection, and reverse engineering. AMDEF had a strong performance post acquisition, including market validation of their recently launched product leveraging in house developed machine learning technology, having received their first significant customer sale for the new product.

9:28 And also two months ago, they received for the second time the King's Award for Enterprise, validating the quality and strength as a business. Now that is with Collins Walker, who provide industrial scale electric borders for steam and hot water applications. There are smaller bolt in acquisition with significant opportunity for growth with strong tailwinds from regulatory drivers for electrification and the drive to net zero. Being a bolt in, we'll be integrating the operations and manufacturing into our portfolio to increase capacity whilst keeping the brand, sales, and service running independently. And lastly, let's leave with Severin Thermal Solutions, our most recent acquisition completed post year end.

10:20 Severin will be kept autonomous as part of the centralized model. They manufacture and sell high temperature furnace systems and environmental chambers for advanced material processing and testing. Focused and innovative high value markets such as aerospace, semiconductors, and nuclear, They boast a strong blue chip global customer base with solid international exposure. They have numerous synergies and cross selling opportunities within the lab division and more broader across the group. Now over to Ami for an overview of financial results for the year. Thanks, Stephen. Hello, everyone. Looking at the financial highlights for the year.

11:07 From a revenue and profit perspective, we overcame a tough first half. Full year revenue showed some growth overall due to acquisitions, but there was a small organic decline of 1.6%. The good news is we saw some organic revenue growth in the second half of the year. Adjusted EBIT reached £10,000,000 compared to £9,600,000 in the previous financial year, and net operating margins improved from 14.5% to 15%. As you can see, we saw some growth in adjusted PBT, and there was a strong cash performance with over 100% operating cash conversion, generating £3,000,000 more than last year.

11:54 As a result, net debt was only slightly higher than last year despite two acquisitions over the year. I'm also pleased to report that we've had a strong order intake year with all divisions up on a like for like basis compared to FY '24.

12:16 Turning to the income statement. The £2,800,000 acquisition growth came from Peak Sensors relating to the first half of the financial year and Inspect Vision in the second half. As I mentioned at the half year, there were closed off or disposed off entity revenues in the comparison numbers, and these arose from Uniform Engineering and Synoptics Inc. These totaled £1,300,000. After excluding all of these, the organic revenue declined 1.6% on a constant currency basis. I'm pleased to report our gross profit margin increased by 2.8% to 64.9%. This is on materials only. On a like for like basis, gross margin was 65.5%.

13:06 Pricing continues to be a key focus for the group, and this improvement demonstrates the success of our operational efforts. On a like for like basis, our cost base increased by 3%, pretty much in line with inflation. Improved cash flow in the year led to lower gross borrowings and together with reduced base rates, and finance charges reduced compared to last year. Tax rate on adjusted PBT reduced slightly to 22.7%, and this compares to 23.5% last year. Looking at below line expenditure, acquisition costs were 400 k higher than a year ago, and so there being more acquisitions than last year as well as aborted acquisitions.

13:54 And share based payments return to a more normalized level this financial year.

14:03 The next three slides provide a bit more detail on the financial performance of the three segments. Let me start with the Products division. This division showed organic growth of 2.8%, with GBP 1,600,000 of the revenues coming from acquisitions. I'm pleased to say that the Products segment showed good organic growth over the second half of the financial year. As Steven mentioned, Greticules, and Fraser all saw revenue growth. Attic threw growth in the professional astronomy market. Applied Thermal Control saw a smaller market for its chiller products as its industry adapted to regulatory changes in its end markets. Margins improved through operational efficiencies through a combination of better gross margins, restructuring and operation gearing.

15:01 Next, the Census division. This division showed a 1.6% organic decline with £1,200,000 of the revenues coming from the P Census acquisition.

15:12 The organic decline was largely caused by a post COVID normalization of ordering patterns at Astor's for their chemical dosing systems, And this follows three years of strong performances by that business. As Steven mentioned, MPB, Shell and Sentek all had good years. Shell and Sentek saw a heavy second half bias to their performance, which led to the Census division showing some organic growth over the second half. Margins largely held in this division at 26.4% compared to 26.8% last year.

15:51 Next, the laboratory equipment division. Clearly, the segment short saw a tougher period of trading with an organic decline of 5.8% over the full year. SafeLab and Monmouth both saw a heavy second half bias to their results, and this led to the segment being broadly flat over the second half, and this was encouraging. LTE had a slower period of trading due to lower activity on environmental test chamber contracts and a slower NHS market. On the lower revenues overall, net net operating margin reduced to 11.3%.

16:33 Turning to cash. It was a successful year cash wise, with cash generated by operations reaching nearly £13,000,000 and free cash flow after leases of about £7,000,000 compared to 3,400,000 in the previous financial year. Over the year, working capital reduced by £1,300,000, which is a positive outcome. A lot of effort was made to manage inventories and to reduce overdue debtors, and this resulted in a broadly flat inventory position at the year end and debtor days reducing from 46 to 44 at the end of April. Trade taxes reducing overall by £400,000. Customer advances increased by £600,000, following a large advance received by ASIC in the year.

17:25 Excluding acquisitions, our working capital as a percentage of sales improved to 18.6% at the end of April. This compares to 19.8% at the end of the last financial year, also excluding acquisitions in that year. The £7,000,000 of free cash flow was used to fund two acquisitions in the year. These cost £7,300,000 between them, and this is more clearly illustrated in the next slide. This slide shows graphically the movements in net debt. The £13,000,000 cash generated by operations is on the left hand side of the graph in gray, and our utilization of that cash is illustrated on the right hand side in black.

18:15 We ended the year with £13,800,000 of debt, excluding leases and deferred consideration, to £13,200,000 at the beginning of the financial year. Our leverage at year end was 1.1 times net debt to EBITDA, which is within the board's preferred range of one times to 1.5 times. At the year end, we had headroom of about £10,000,000, and we have a further £5,000,000 accordion option event available at our bank's discretion. There was £600,000 in outstanding deferred consideration at the year end, and this is expected to be paid in the first half of financial '26.

19:04 It's worth noting that the acquisition of seven Thermal Solutions in early June for GBP 4,800,000 utilized some of this headwind. Now I'd like to hand back to Stig, who'll take you through the outlook. Thank you, Amit. Great job. Now let's look forward to the next year.

19:26 For the future, our strategy remains consistent, and we will continue to drive organic growth by investing in new product development, promoting synergies, and driving operational excellence across the portfolio whilst also pursuing high quality acquisitions. We enter the new financial year with positive momentum underpinned by a strong order book. While we remain mindful of wider economic uncertainties, we are confident in a resilient business model and the long term opportunities and drivers within our markets. Our acquisition pipeline remains robust and actively managed, and we continuously review the pipeline, which is supported with there being a wealth of niche engineering and manufacturing businesses within The UK and internationally seeking to exit where SDI would be a natural fit, and we have the capacity to execute on these opportunities.

20:27 With all of this said, we expect to deliver FY '26 results in line with market expectations and are confident in our ability to generate sustainable long term value for all of our stakeholders. Of course, the strong results reported today would not have been possible but for the hard work and dedication across the SDI GROUP. So I would like to thank them for all of their efforts and hard work. I would now like to open up for q and a. Thank you for listening. That's great. Well, thank you very much for the presentation. Ladies and gentlemen, please do continue to submit your questions. You can do so just by using the q and a tab situated on the top right hand corner of your screen.

21:13 But just while the company take a few moments for you the questions that have been submitted today, I'd like to remind you the recording of this presentation, along with a copy of the slides and the published q and a can be accessed via your investor dashboards. As you can see, we have received a number of questions throughout today's presentation. And, Amy, at this point, if I could hand over to you, that'd be great, I'll pick up from you at the end. Okay. First question for you, Steven. What impact are you seeing to the business from the introduction of tariffs? Yeah. Thanks, Samir. And I see there's there's several questions on the same thing. So around 10% of our earnings in f y twenty five came from direct sales to The US with a minimal exposure of US government contracts. We do not anticipate that the introduction of tariffs on the products sold to The US or reduction or federal grant funding for The US life sciences research sector will have a significant impact on the group. And, and to that, we are holding guidance for f y twenty six.

22:10 Second question, what impact does the group anticipate from the changes to employers and I contributions? That one's from from me. I think we've talked about this previously. The impact of employers NI and indeed, the increase in the minimum wage, means that we we will see about a 600 k impact for the f y twenty six, so for the full year impact. That's already included within the guidance that's out there, so it's already been baked in. Alright. Next question. When do you expect to appoint division business leaders? That's what you see. Yeah. We're we're step ahead. So so we already have. We've we've recruited a division leader for the lab equipment and also for the industrial products division as well. At this point, we do not intend to recruit one for the sensors division.

23:05 So we're yeah. We're I'm quite excited about these these individuals starting to make an impact. Okay. Next one is for me. R and D tax credit is much lower. Is this lower level permanent? Now we're still getting an R and D tax credit. It's just accounted for slightly different because the R and D environment and accounting has changed. We still will get an r and d tax credit, but it's worth under, worth knowing that the, the the whole r and d tax regime is less generous today than it was a cup two or three years ago because of

23:41 changes in the tax legislation. So, yes, it will be lower level, you've got to remember that we're also acquisitive. So some of the companies that we buy also have r and d tax credits. So, as we grow, the r and d tax credit will grow simply through acquisition. Next question. How is the order book in q one this year compared to the improved order book that you saw in q four? Well, the order book, I'm pleased to say, has grown even over. We haven't had the full quarter one yet. Today is the last day of the quarter, so we've really only had two months and the order book has grown slightly over the first couple of months. The second question is it's grown from the higher level at the end of q four, so it's improved from there.

24:29 And second, has Astell's bottomed at these levels? I think the current view is that yes, it has and it's going to grow from here is our view at this moment. We have three good years. We always knew that 2020, FY '25 would be a slower year from a product standpoint for our stores and that is how it appears that it has bottomed out. To start off FY '26, GROUP PLC has been very good. Okay. FY '26 unlikely to be able to make large scale acquisition given scale of debt and debt EBITDA. That's the way okay. So we've got a statement there. So the way just in terms of where '26 will go, we've obviously made an acquisition at the beginning of the financial year or early in the financial year. But we are cash generative as you've seen from these financial from the commentary that I, that we just talked about.

25:25 We expect cash generation to continue in the same way as you saw in FY '25. Cash flow will the cash flow will reduce debt. So we so we in in '26, what you've what we've done, then you'll see at the half year most likely is that the debt will go up and it's not coming down again as we generate cash. The same thing happened in '26. So we ended in '20 sorry, in '25. In '25, we started the year at 1.1 times net debt to EBITDA and we ended the year at 1.1 times net debt to EBITDA and that and despite buying two companies, generated and we generated the cash to do that. The same thing will happen in twenty in '26. How much organic growth do you expect per annum for this current group over the next five years?

26:15 Well, we we target around circa 5%, I think is what we've said, five five to 7%. And I think circa 5% is what you'll see in the guidance for the current financial or the new financial year. Next question, some guidance on color on order intake and performance so far this year. So, yeah, the order intake has been good. We started the year positively. Order book is good, so we're retain confidence for the the year to come. Only two data points, only two months so far. There's 10 to go, long way to go yet, but so far so good. Are you performing above last year? Well, we our guidance is for that, and so we're confident that that will happen.

27:08 When the board identifies efficiencies and it's believed that savings should be reinvested in the business to enhance growth rather than let operating margins drift up,

27:23 So I think it's about reinvestment in the business to enhance growth and to lower the margin, I think, is the next question. Well, we we we're already doing that. If you look if you think about it, we if we're if we're division leads, we are already reinvesting in the business, to help enhance growth. Some of the responsibilities of those divisional leads will be to generate synergies and help us generate organic growth. So I think we can do both. We can probably enhance growth by reinvesting as well as, you know, holding operating margins. I think 15% is a reasonable level, but we do have acquisitions which do impact upon the overall group net margin. So net margins very well move up simply because of a mix effect. It's not simply growth in what the existing portfolio.

28:23 Current brokers seem to assume no organic EBIT growth. This is not too conservative. No. I think there is organic growth. I think you will see EBIT growth and you will see organic EBIT growth. I don't think it's too conservative. No. I don't don't see it that way. And what is the margin potential for the current group over the five years? Well, we're looking at I mean, I think, if you think about net operating margin, then I think, you know, anywhere between fourteen and fifteen percent, is is really where we are with the current group and as it's currently structured. But as as I've just said, new acquisitions will influence our net operating margin. That's adjusted EBIT margin, I think, how I define that.

29:10 And I and I I think that is it. A minute. Any more questions? Please ask. I think we've commented. We have no more. Ah, here we go. We have one more. Sorry. It's Sanjay. How much will m and a contribute to EBIT? Well, we added about 700 k, I think, to the contribution for seven, so that was already included. And I think there will I oh, I see. Now some of the acquisitions, are will we had to normalize some of their costs, to under SDI. So, the pretax EBIT, the pre EBIT as declared for each of the companies do have some corrections such as rent or additional management introduced to them all so you won't see the whole of the EBIT, that you saw pre acquisition within SDI.

30:13 We do normalize it and you'll see in each of the you'll see in each of the press releases how much a normalized figure is. So it's slightly lower than the figure that question the asked, is 1,500,000 of EBIT, which I think is from the all the pre acquisition numbers on the press releases that we we sent out. There's also one about multiples as well. We we have the the classic SDI model is is to base on four to six times goodwill or four to six times adjusted EBIT. We're holding that. If a business has got much higher growth potential, for example, it'll be likely towards the the upper end. But typically and and you'll see pretty much all the acquisitions we've done do fall within that range.

31:05 So there's no reason to change that at this point. We're not seeing any reason why why we need to either. Okay. Other scientific instrument and r and d focused companies are having problems in their end markets, university, pharma, life sciences, research centers. Why is that not the case for SDI? I I tried to address that with it at the top of the call. Our exposure particularly judges call out specifically US life sciences research. We we don't have that that focus or no no do we have that. Are we so so susceptible to to that those markets either? We we we do have the the breadth. Most of our US markets is industrial.

31:56 So we we tend to be a lot more immune to to to changes there. Okay. How do you define effective cap capital allocation? And then how do you retrospectively assess? Well, we do this in terms of planning process. So clearly, we we invest in the businesses through CapEx. Typically, that's around 2% of revenues. We do a bottom up. We don't do it top down. Businesses during the budgeting process, ask for CapEx and we we and and if there's a business case, we will support it. And generally, is when they ask. We obviously then use our capital to or our cash generated to acquire companies, so that you can see through our results.

32:45 We do consider dividends annually. At this point, we don't see the we don't see we we think there's a better use of our cash in in acquiring companies than paying a dividend at this point, but we we do look at it annually. Next one. Do you consider SDI GROUP to be part of the serial acquirer ecosystem? Many of these businesses are in The Nordics, but some are in The UK. And if so, do you look to any of these businesses for best practices or process for approaches to deal sourcing and capital allocation? The the the answer to that is is yes, most certainly. We always look to peers to see what if we can improve processes. We'll we'll never be the the perfect business. We continue to learn and improve.

33:30 So, of course, looking across peers, I'd like to hope as well that that our peers do do the same with us as well. Is five to seven between 57% organic growth already feasible this year? But we still think so. It's a range. So, you know, we think and even and I think the the guidance out there is circa five, I think. So, yes, it's a we are cognizant of the macro environment, but, you know, we still think we can deliver organic growth and the order book is what's driving that. How important is the contribution of ASIC to the group on sales and EBIT? ASIC remains to be a a strong contributor to the group. In fact, it's it's one of the strongest as as we we stand here today. So it it continues to to do it to be important to us. So yeah. We we have supported attic quite quite considerably.

34:24 We've spoken earlier slides about about the improvements we've seen there, And I'm delighted to to see the performance in ADI GROUP just just improving, particularly in the professional astronomy side where they they they have secured a very strong contract going forward. So so ADI GROUP is looking to be in a very strong position right now. Can you touch on the service revenue growing nicely as a percentage of sales over time? Any target here? Thank you. I don't think we have a formal target, but it is very much our on our agenda to try and grow services revenue in that segment. Yeah. And every every company we've got does does have service revenue to a lesser greater extent. And clearly, service revenue as as we see it as recurring revenue is always a very nice thing to have.

35:11 So we are focusing on it. What's of course is is it needs to be it needs to be profitable and those vary across the group somewhat. So we're gonna be focused on the more serve the more profitable service businesses. So I think watch this space, but, yeah, we will be starting that's a metric we will be tracking internally. How is management incentivized? Do you hold stock? So there's so we obviously have and and then as well as the base salary, I assume you're talking about executive directors here. But there's a there's a bonus, an annual bonus, part of which is paid in shares and some of it is paid in cash. For the last financial year, was all paid in shares. And there is a long term incentive plan, which is over a three year period, which requires growth in 50% of it requires growth in EPS from a baseline year to the third year. And then the other half is total shareholder return, which is measured against a basket of 20 companies and the it's all detailed in the annual report, which will be coming out in a couple of weeks or two or three weeks.

36:17 But the there's a basket of companies against which we are measured over a three year period in terms of shareholder return. I think we do hold some stock over time with these long term incentive plans and deferred bonuses into shares, look to that that you should see us increase our holding of stock. But the board does hold stock, including the chairman, so there's an there is a holding there. And you can see it in the back page of the presentation, which will be go live after this after this meeting. Rev what is the synergy potential for the company? That's a good question. Yeah. So if you're talking about internally, we've first spoke to the some synergies earlier in in the presentation, but it's it's something which is quite important to us. Although we are operating as a decentralized model, we don't have a a large head office team and and we're not likely to either.

37:19 So so really, we have to we have to cherry pick and and really do and promote synergies where synergies does actually make sense across the group. We can't force them. But this certainly, last year and into this year, we're seeing significant ones. We already I've already spoken about the group marketing function, for example, and also where where companies came together to close much larger bids. So it's happening more and more, but again, it's it's really where it makes sense. Okay. Revenue exposure from the public sector. We do have some, don't we? I mean, don't necessarily collect that data simply because of our model of distributors. We can't always be sure where our product goes by distributors. We can't necessarily always know where the end markets are.

38:10 But we do have some revenues with the public sector, predominantly in The UK. Yeah. Most of that is the biggest exposure is within the lab group. The the other two the other two divisions has got very little exposure from the public sector. So you do see a lot more in life sciences and biomedical. So that so if you want to look at our exposure, so it's it's it will be a a small percentage of the lab equipment. Okay. I'm just seeing if we've got any that we've missed as we've been working through them. I think we are nearly at the end unless someone has a new walk. Okay. We've got one late one in. What What new products do you have planned in the current year?

38:59 That's a good question. So last year was was a was a big year for product launches as you're saying. We we we listed some of them, certainly not all of them. What we're looking for is is is to really start reaping benefit from the ones that were launched last year. SDI as a group, because we do high-tech niche products, we have to stay ahead of the competitions and and and continue to deliver products which hit market requirements and needs. So we do continuously reinvent and and re innovate which is important. So we will we will never stop that. But at the moment, the focus is really getting return on the one that we launched last year. Like, for example, LTE, so the new new order plate range was launched last year, but we really need to be seeing the revenue coming this year.

39:50 Synoptics again, ATC are continuing to to stay on top of regulatory drivers with new gases coming into vogue, etcetera. So that that that's just a a continuously evolving cycle right throughout the group. Okay. How much growth in order intake did you have in f y twenty five? Very significantly higher. It was in double digits in percentage terms is what I can tell you, very significantly higher. That's a good one. Do you expect EBIT split half one half '2 FY '26 to be more evenly spread versus last year? Very good question. We do expect a heavier half two split again this year simply because of the timing of some contracts that we are have in we have at the minute to execute where they the customer wants the product to be delivered in half two and just generic budgeted timing of when we think the revenues are. So you will see a heavier or a more second half biased performance in the current fund in FY '26, just like you saw in FY '25.

41:05 So, yes. Do we or no. It's not going to be evenly spread. It's going to be more second half weighted. As Ami says, once we start dissecting the structure of the order book, there is some significant contracts in there, and significant contracts do take longer to deliver, which is why we we are expecting, somewhat of a split of a split this year. And the same individual has asked the follow-up question. He's asking a very good question there, but growth year on year in both half one and half '2. If you're talking about FY '26, that remains to be seen. There will be growth in half one. You know, clearly, was a heavy half one, half '2 bias in in '25.

41:50 It remains to be seen what the growth year on year will be in in the next year. But ultimately, we're really just working towards a full year impact if you think about it. It's the full year growth that's really important rather than whether half one or half two have organic decline or organic growth. Overall, it's the year end that's the key. We are seeing a a bit of change in the trend of the of the of the revenue across the group whereas before it was it was few very large orders. Now we're we're seeing a lot lot more spread across the group. So the so the the more of the businesses that are are contributing to the top to the overall top line. And to that, really, that's why we're getting a change in in the dynamic and a change in the timing.

42:41 Okay. It looks like that was the last of the questions. And so I think we'll conclude the q and a. That's great. Well, Steve and Amy, thanks very much for answering those questions from investors. And of course, the company can view all the questions submitted today, and we will publish responses out on the investor me company platform. But just before redirecting investors to provide you with their feedback, which is particularly important to the company, Steven, could I just ask you for a few closing comments? Yeah. Of course. I I'd really like to thank everybody for for attending the session. We at SDI are delighted of the the progress and the and and the delivery of the of the strategy, we outlined last year. And I think that's really important to us. So so last year was very much it was it was delivery of the strategy and and this year has been no different. We're gonna continue to deliver to that strategy.

43:32 We did see a strong financial year last year. Our optimism into this year continues. So I think I'm I'm particularly excited about about this year also. But thank you all. Well, that's great. And thank you once again for updating investors today. Can I please ask investors not to close the session as you now be automatically redirected to provide your feedback and all the management team can better understand your views and expectations? On behalf of management team of SDI GROUP PLC, we'd like to thank you for attending today's presentation, and good afternoon to you all.