Time Finance (LSE:TIME) — Annual Results

0:02 Good afternoon, ladies and gentlemen, and welcome to the TIME FINANCE PLC Annual Results Investor Presentation. The company may not be in a position to answer every question received during the meeting itself. However, the company review all questions submitted today and publish responses where it's appropriate to do so. These will be available via our Investor Meet company dashboard, and we'll notify you when these are ready for your review. I'd also like to remind you that this presentation is being recorded. Before we begin, we would like to submit the following poll. And if you would give that your kind attention, we would be most grateful. And I'd now like to hand over to James Roberts, CFO and Ed Rimmer, CEO from TIME FINANCE. Good morning to you, or good afternoon to you both.

0:49 Good afternoon. Good afternoon, everybody. Yes. By way of introduction, Ed Rimmer, chief executive for TIME FINANCE.

0:59 I joined the business originally in June 2017. Three years, I did as chief sorry, chief operating officer and then rejoined the business at the start of March this year as as CEO. I would say that we did a a full strategic presentation update very recently in June. So once we've done our introductions, I will fly through some familiarization slides on who the business is and what

1:31 we do, but we'll try and focus more on the financial results and probably more importantly, we're up to with our strategic plan. So I'll just hand over to James to introduce himself. Thanks, Ed. Yes. Good afternoon, everybody. I'm James Roberts, CFO of TIME FINANCE. I've been with the group now since May 2017.

1:54 Prior to that, I'm a I'm a chartered accountant with PLC and worked in various buy and build and aim listed businesses. But I'm sure, as Ed said, we we've heard that before, so we'll we'll hand back to Ed and and rattle on through. Okay. Thanks, James. We're gonna turn our cameras off now. It's easy just to see the the screen without the cameras on. So forgive me if you if you can no longer see see us. Okay. Great. Right. So who are we and and what do we do? Well, in simple terms, we're an aim listed business that provides finance to small and medium sized enterprises in The UK. We're not a bank, so we don't take retail deposits. We borrow our our money effectively on wholesale facilities, which means we operate in the tier two sector of the market, and we lend that out to to small businesses predominantly on our own book, but we also have the ability to broke out business that doesn't meet our credit criteria.

3:00 Generally, if it's tier one, better quality business with lower rates or in tier three where it's not quite the same quality that we want for for higher rates, and we take a commission for that. We have a multiproduct offering, which we believe differentiates us from the majority of our competition where we offer asset finance as well as invoice, loan, and vehicle finance. And the business has been trading for around twenty years, previously known as one PM, and the business rebranded at the end of last year to TIME FINANCE. And we have four trading divisions, as as I just said. I won't go through all the detail here. In summary, our our vehicle finance business broke out all its activities.

3:53 The other three divisions, asset, invoice, and loans, predominantly lend on on own balance sheet. We we generally operate in the tier two space. We generally receive introductions through intermediaries, whether that be specialist brokers, insolvency practitioners, or consultants, professional firms. We cover soft and hard asset in the asset finance business,

4:19 factoring and invoice discounting in the invoice finance business, unsecured, unsecured loans in the loan finance business. And as I say, we broker all our our vehicle finance businesses out generally to tier one and tier two funders. And our funding for own bought lending tends to come from a series of of wholesale facilities, which tend to be challenger banks or or high street banks who provide us with our our cash. Some numbers, we lend facilities to around 20,000 SMEs. Last year, we originated around a £100,000,000 in new business, either on our own balance sheet or or broke out.

5:06 Our balance sheet currently stands at around 57,000,000, and we achieved profit before tax and exceptionals last year of just over 3,000,000, which was a slight improvement in the in the previous year. And in terms of where we sit in the markets, our competitors do include banks, challenger banks, also alternative finance platforms, fintech businesses as they're commonly referred to nowadays, other quoted companies similar to ourselves, and smaller private businesses. Those smaller private businesses tend to compete more with us in terms of the personal service angle and the speed and flexibility of doing business, but they don't tend to have the product range that we have.

5:55 The banks, on the other hand, tend to do have that product range, but they don't tend to be fast and flexible and provide that personal approach. So whilst we're not completely unique in terms of being the only company out there that does what we we do, we do believe that we're one of a smaller number of businesses that has the ability to be fast, flexible, provide a a a personal service, and importantly, have a range of products that we've got that can cover more or less all the requirements in terms of commercial lending that a small business requires at the moment. So that's the flavor of the business. I'll now hand over to James who will take you through our our recent financial results.

6:41 Thanks, Ed. Yes. Appreciate it. So I'm just gonna spend sort of five or ten minutes running through the year's results to 05/31/2021. As Ed said, we did a reasonably in-depth trading update back in mid June, and the numbers are very much in line with that. So but I'm gonna try and delve into a little bit more detail in some of the key areas that we think are are particularly important for for somebody looking at the business. So just a quick whistle stop of the high level numbers before diving in. We can see revenue was was down by about 17%, and I'll I'll come on to revenue and why that is in a sec. Profit before tax and exceptionals, as as Ed mentioned, was was just over 3,000,000, which is a a marginal improvement of 3% on the year before.

7:30 Earnings per share, 1.98p per share, up about 13%. And our net assets on the balance sheet are now just topping 57,000,000, which is an increase of about 3%. We do have a fair amount of intangible assets and goodwill on the balance sheet. So another key indicator for us is our net tangible assets, which have risen to just shy of 28,500,000, which is about 7% up on the year before. Quite a key thing for us during the pandemic, which I will, probably labor the point in a bit, on a separate slide is about cash, cash equivalents, and what we call convertible paper that we can turn into cash within twenty eight twenty four or forty eight hours. And that's key for us, in in ensuring the robustness of the business and and providing, cash for future growth. And we can see that's increased significantly since the end of May twenty twenty, you know, up at 11,300,000 from 1,400,000 as of the 05/31/2021.

8:29 Our unearned income, and that's interest on leases and loans that we have on our balance sheet at the year end that assuming they all work to plan will come through over the next twelve, twenty four, thirty six months depending on the life of the lease or the loan stands at just under 15,000,000 marginally down on on the year before. And our blended cost of borrowings, which is the cost of funds we get in that we can then lend on to others, has stayed static despite the pandemic by at about 4%. Our net write offs have marginally increased to 1.6%, but pleasingly, we think the book's in a stronger position than it was a year ago. Our deal's in forbearance. This is given the pandemic where people came to us and asked for help has fallen by nearly a 100%, 97% reduction from just over 24,000,000 to just under 1,000,000.

9:21 And our deals in arrears as a percentage of the gross book have fallen by about a third from just under 21% to just over 14%. And we've maintained our bad debt provision at around 5 just over £5,000,000. And I'll talk about most of those key indicators in a sec. But in a snapshot, that's where that's where we sit at the May 31. So if we look at a bit at the p and l, I touched on the fact revenue had fallen, and that's due primarily to two reasons. One is our brokerage businesses, and they were particularly hit by the pandemic. They did make up at the the year before last about 20% of our revenue, but they've accounted for about 50% of the reduction between f y twenty and f y twenty one.

10:09 So they were particularly hit by the pandemic. And largely, that's in relation to the vehicles brokerages, which for a number of the lockdowns were physically closed, the dealers were, and so people weren't able to actually, buy cars. So that that's that's part of the driver there. The other half is because of the size of the book. Our net lending book, the average book we had over the last twelve months was just over 100,000,000 compared to about a $100,120,000,000 the year before. And in terms of generating revenue, it's a bit like turning an oil tanker. It takes time. You've got to build up that own book lending piece. That in turn will then provide revenue for the next two, three, maybe even four years. So the fact that business that the loan book fell due to the pandemic, we're now in the stage of trying to increase that book again. Revenue will come back, but it does take a a little bit of time.

11:05 As as we touched on, we've got about 15,000,000 of unearned income as we start this year going into this year. Pre pandemic, we we had about 17,500,000 of unearned income. So you can see there's about 2,500,000 of revenue is just from the unearned income associated with the book. Having said all of that, on the revenue, profit before tax and exceptionals has marginally increased, basically remained static, and profit before tax on the full p and l has has stayed at at 2,000,000. So both of those metrics have stayed where they were given the reduced revenue shows the margins have increased increased, which is which is pleasing. And that's due both to a focus on gross profit with slightly lower funding costs, introduced commissions and bad debt charges, and tight operational cost controls, primarily staff costs, which you've seen our gross profit margins increase by about 7% and our profit before tax and exceptional margin up about 3%.

12:04 Of particular note, in the last financial year, the one we're looking at now is the balance sheet due to the pandemic, and it's one we're quite proud of. We think the the pandemic showed the the strength and resilience of the of the group and and that we're able to withstand some pretty tough times. And as you can see, four key areas here just to just to go over. Net tangible assets, as I touched on, have gone up increasing to about 24 28,400,000, and because we did remain profitable throughout the period. Given everything that's going on, that was particularly pleasing. Cash is up. In terms of actual hard cold cold hard cash, it's increased from point one to about 7,700,000. But you may remember on the slide before I mentioned 11,300,000 of cash or cash equivalents and convertible paper.

12:55 And the reason I I I highlighted that 11.3 rather than just the 7.7 is because at May 31, we did have just over 4,000,000 of convertible paper deals that we haven't we'd funded ourselves but haven't used our funding partners to provide funding to. If we wanted to, we could convert them with our funding facilities within twenty four forty eight, certainly seventy two hours into cash between 8090%. So, theoretically, that could give us 3,500,000 of of cash within twenty four, forty eight hours, hence the the 11,300,000. That's really what we've got to play with for one of a better expression. So really vast improvement in cash, which was the right thing to do. We think during the pandemic, we tightened our belts, got the the business ship shape while everything was going on, and it does give us a a strong base to grow from as we move forward.

13:47 In terms of the existing book, the next two columns focus on that. As we touched on, arrears have fallen. They they increased greatly to May 2020 partly largely due to the pandemic. But over the last twelve months, sterling effort from our colleagues in risk and credit have seen arrears reduced by over a million from the level they were before. So they are at the moment, arrears are in a better lower than pre pandemic levels, which is which we think is pretty good. And deals in forbearance, as I touched on, this is people coming to us during the pandemic and saying, for whatever reason, I really can't pay due to the pandemic. Can you help me out? We would, where possible, if it was a valid reason, try and work with our clients. And at one stage, we had about £25,000,000.

14:34 That was at June 2020 last year. We're in one form or another of forbearance. It was less than 1,000,000 at year end and continues to fall. So forbearance is, to all the rate of purposes, pretty much a thing of the past, which we're, again, very pleased with. One thing we have focused on, and and I've mentioned many times on these presentations, but I think it has stood us in good stead throughout these these times is the diversification of our lending. And this this slide here is just to to to hopefully highlight that point that at May 31, we had no one sector in our book accounting for more than 5% of of the lending. And by the tenth sector, you're just over 1%. So the top 10 sectors of our book are less than 25% of the entire lending. And as you can imagine, that tail goes on and on and on through the multiple sectors that are out there. But that spread has been particularly vital for us and is is something that underpins our business model because if one sector particularly struggles, so for example, in the pandemic, as we all know, hospitality was was shut for a significant part of the time, we're not weighted unduly in one particular area such as that. So we are able to to ride through the more tricky times because of this diversification.

15:50 So as we see there, we we feel we're a very well diversified business, multiproduct offering, as Ed said, across a number of sectors, and that does enable us to to withstand a number of headwinds that we we faced. We can only do what we do because of the support of our funding partners. And all our funding partners, I'm pleased to say, have been incredibly support supportive throughout this time. We kept our doors open to a lend to valid UK businesses, and and they kept their support funding lines to us in place as well to help us to do that, and and that's great. As we can see here, we have, at May 31, just over 160,000,000 of active facilities that we could use. We've used about 67,000,000 of it, leaving about $9,596,000,000 of headroom to grow into. It's worth stressing that we have to put our own funds into every deal. It's it's not so we put in between ten and twenty percent of cash into every deal.

16:50 But assuming we can do that and our medium term plans imply we can, then we have a 95,000,000 headroom of which to to use up to grow this business over the coming months and years. One pleasing development that's happened in the last week was that our NatWest facility for our invoice finance businesses, the 42,000,000 facility you can see there, we renewed for another three years. And, actually, it includes an 8,000,000 accordion. So if we need it, we can increase that facility to 50,000,000 to enable future growth in the in the business. But as you can see there,

17:26 three distinct funding lines for our our three owned book lending businesses, number of partners in each of those, again, diversifying our funding line, particularly in the asset bit, and they've all been very supportive. And it puts us in a strong position, we think, as and when we emerge from from all the pandemic effects.

17:49 And with that, that is a a whistle stop tour of the numbers. I'm sure there'll be questions at the end, but I'll now hand back to Ed who can take you through where we're going in the future and and what we've done over the last few months. Ed? Thanks. Thanks, James. As James said, what the pandemic has allowed the business to do is really focus on getting getting it ready for a recovery that we are now seeing taking place. It's early days, and we hope it will start to gather pace through the course of the next few months, but we are we are starting to see a difference in the market in terms of pipelines building.

18:30 And, obviously, for that, what we've done is use the opportunity to get ready to take take on those opportunities. And part of that this is a on the screen is an extract from our our report and accounts, and part of that is obviously my appointment into the business. Coming up with a a new strategy and obviously now looking to to deliver it. And that's effectively what we've done over the last last few months since I returned to the business.

18:58 And the summary of that really is fourfold. We want to use the rebranding of of the old one PM business and its associated brands to become a recognized national funder under the TIME FINANCE banner. Through that, we would like to double our lending book up to around 250,000,000, achieving profits as stage one back up to where where we were pre pandemic as soon as possible and then push on above above where we were pre the pandemic. And and and, obviously, with that significantly strengthen our balance sheet as we focus more on own book lending so that through this period, which is a four year strategy, it takes our tangible net assets up to around 55,000,000.

19:46 How are we going to do that? I introduced this slide in the presentation that we did in in June. So it's a complete repeats of that. So if you've heard it before, forgive me, but the next few slides will give a a progress update on some of the key things that have happened. So I'll I'll just summarize how we're looking to do this. It's really six key strands of of of activity. The first is focusing on our core products, the asset, loan, and invoice finance businesses that are all on our own balance sheets. We do have some, what I would call, non core business in the group, which is business to consumer lending, which is all brokered activities. And we're not looking to necessarily focus in and grow those businesses.

20:32 It's the own book side of the business that we're looking to focus on through those core products. The multi products offering, as I mentioned, really does differentiate us from a lot of our competitors and moving into offering an integrated asset based lending proposition is something that is key to us moving forward. I've mentioned about repositioning the brand and putting some investment into marketing so that we do that both through traditional channels and through digital capabilities, which I'll I'll mention in the next couple of slides. We recognize that we needed to invest in some further talent, predominantly some sales origination talent, which is in progress, and we've made some some real positive progress with that, which I'll come on to.

21:18 Another focus is bringing further liquidity into the business, something that that James is tasked with obviously doing. Our liquidity position is better than it materially better than it has been at the height of the pandemic when we had quite a bit of the booking forbearance. And and we're now looking to use that better liquidity to to grow, particularly the asset finance and the loan business, which needs equity to do that in order to tap into our our debt facilities. And we'll continue to do that as we as we deliver this growth plan in terms of bringing additional liquidity into the business. And also to look at targeted acquisitions that has not gathered an awful lot of paces yet because there's been other priorities. But as and when they come up, then we would like to look at additional acquisition opportunities that fit with our core product offerings.

22:11 So in in terms of some progress against those strategic initiatives, the first one focusing on our core products. We were approved as a lender under the CBIL scheme, and we used our allocation to lend around £12,000,000 under that scheme. Pleasingly, we were able to get accreditation under the recovery loan scheme as well, which was launched a few months ago. And that is gathering pace in terms of the the volumes that we're seeing across the business. So that's a positive that we've experienced over the last two to three months. We've also restructured our asset finance senior management team to provide us with some operational expertise and move forward some of our systems initiatives that we really need to move move on with in order that we can keep pace with the market, but also offer a better user experience to our our customers.

23:11 We are also looking for a new head of asset finance to replace our long standing head at the moment, Carol Roberts, who is due to retire. And that should be an exciting announcement in the next month or so. We're down to a a short list of candidates to take our division forward in the asset finance world. And we've repositioned our soft asset proposition, which I mentioned the last prod presentation. We were seeing lots and lots of small deals, which were creating quite a lot of unnecessary work and quite a bit of inefficient and see. So we've now reached we've re propositioned that so that we have a minimum ticket size of £5,000. And that is meaning already that we're seeing a slightly higher average ticket size coming through and as importantly, a more manageable flow of of inquiries where we can convert to the better level.

24:08 So progress and good progress being made there with our core product offerings. In terms of the multi product solutions, we've recruited a a new director of the loans business and also ABL to take this this forward. A lady called Sharon Briden, who is very experienced in the sector and has has worked with me before. She joined at the beginning of September,

24:32 settled in very well, and has a long list of things to be getting on with over the next few few weeks and months. And key to that is developing the ABL proposition, which Sharon will be responsible for. We've also relaunched our cross sell initiative which is badged as Excel. That was formally relaunched at the start of September. We've developed an internal portal to manage the process flow across the business,

24:58 we've got some specific targets for each of the products. And we're already seeing some exciting cross sell opportunities coming through the pipelines through our various teams. James mentioned earlier in terms of the bringing further liquidity into the business, it's not necessarily further liquidity, but it is an important development. Our back to back provider NatWest for the invoice finance division has re reconfirm the terms, put a new facility in place over the next three years. It's got improved terms as well, so it's slightly it's slightly more cost competitive, and we have got the additional 8,000,000 accordion. And that will see us through for the next couple of years at least. So that's a real positive from our funding side of things.

25:45 Investing in further talent, that's taken up an awful lot of time. I've spent quite a lot of time on this because of contacts that I've had in the in the industry over the years, and we've made some good strides. Obviously, I was appointed as CEO permanently from the June 1, and that's enabled, I think, other people to see the the certainty that we've got now around the plan, and it's helped attract other people into the business. We've increased our our sales resource in the invoice finance business, including a new head of sales chap called Adrian Payne, who's joined at the start of September. Very seasoned professional in that world and will attract other, resource, I'm sure, into the business. And we've also brought in three additional business development managers. Our plan is to get up to a dozen people within the sales side on invoice finance.

26:38 We started off at the beginning of our financial year with six, and we've now got nine in place. So good progress made there with a a reasonable number of discussions continuing to take place as well. And we've also increased the the size of the the sales force in the asset finance team by taking on four additional new business people. And we've also put a lot of work into the rebranding and and the capitalization efforts of the rebrand that was done at the end of last year. Our head of marketing, Diane Blinkhorn, very experienced. She worked with me at Bibi for thirteen years, and we have Kate Brown also heading up the marketing function who is doing a a sterling job at taking our PR effort into the market and raising our profile.

27:29 We've definitely seen that that improve in the last three months, not just in terms of what we see ourselves, but the comments that we received from our introducer network in terms of the deals that they're seeing being done as case studies

27:42 and the people that are joining and other stories that we're looking to get out into the press. So that that whole reposition of our of our TIME FINANCE brand is gaining good momentum. And we've also recruited a digital marketing executive to take on that side of the business with a bit more gusto. So overall, I would say good progress being made. In terms of the summary and and our outlook, going back to James' comment, I think the business has shown a lot of resilience through the pandemic, and the liquidity has certainly improved, putting us in a in a better position than where we were at the start of this calendar year. We've strengthened the management team. We've got a new vision and a new strategy now to deliver a four year plan that's already started, and we've made good progress with that. The business does stand out with our multiproduct offering. That's a common theme that we hear from new people that are attracted to the business, our clients, and also our introducer network, and we're looking to take full advantage of that.

28:47 And I think what we've done really is try to put the business in our best possible shape to take advantage of the opportunities that come up post COVID and make sure that we are well positioned to do so. And and I'm I'm very happy with the progress we've made in terms of the strategic plan. I would like, obviously, to see the market come back now and hope that the momentum that we've seen over the first part of September continues through the autumn. And if we can see that, then I think the business will do very well. That's the slides complete. So thank you for listening. That's great, Ed. James, thank you very much indeed for updating investors this afternoon. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated on the right hand corner of your screen. But just while Ed and James take a few moments to review investor questions submitted already, I'd like to remind you that the recording of this presentation along with a copy of the slides and the published Q and A can be accessed via your Investor Meet company dashboard.

29:49 I'd also like to remind you that your feedback is important to the company. And immediately after the presentation has ended, you'll be redirected to the opportunity to provide your feedback in order that the company can better understand your views expectations. James, Ed, obviously investors had the ability to pre submit questions along with a number of questions that have been submitted during the live event. And perhaps, James, I could just hand back to you and where appropriate, if I could ask you to read out the question, who it's from and to give a response. And of course, if you guys want to bring on your cameras, please feel free to do so just by simply clicking on that camera icon at the top. Thanks, Mark. Yes. So, yes, there were three pre submitted questions. I I think two of them are very, very similar in what they're they're asking. So I will answer one of them and hope that ticks off the second one. And then I'll I'll hand on to to Ed for the third, and and then we'll go through all the new questions that have have come up today. But one of them was, as I say, which is very similar to the second one as well. Can you please discuss your thoughts on capital allocation, in particular, at what ROIC threshold you prefer to pay out capital through buybacks or dividends instead of retaining it?

31:00 I suppose in a in a nutshell, in a in a simplistic answer to that question is, at the moment, as as explained in the medium term strategy, our aim is to reinvest all our funds for the short term, medium term into growing the business. We want to get back to and beyond where we were in 2019 before COVID hit, and that does mean lending more on our own balance sheet and using our cash to lend on our own balance sheet to grow as safely and securely, but as quickly as we can. As such, there's no real specific ROIC hurdle currently in place. But once we get to the size we were at and beyond and or if we find the demand is not there, then we will reassess and and look at the best use of our capital, whether it's to reinvest for growth, to pay dividends, or or repurchase shares. So apologies. There's no sort of scientific figure to to tell you about, but it is, at the moment, very much all focused in growing that own book let own book own own book lending book, which in turn will strengthen the balance sheet and hopefully lead to enhanced shareholder returns in time. That's where we stand on that.

32:18 The second question, as I said, was is very, very similar, so I I I hope I answered that. And, Ed, are you okay to to to take the other one, which was how do you expect the size of the own book portfolio to evolve in the next three to five years? Sure. Yeah. I've well, I think we covered that, didn't we, in terms of the presentation. So it's really taking the the book at the moment, which stands at around 110,000,000, not $2,250,000,000 over the course of the four year plan. And that's how we see we see the growth being being met over the over that that time scale. As I've said, predominantly through focusing on the the own book side of things and the core products. So I'll be repeating myself if I if I go on any further, but, yeah, that's what we're looking to to do.

33:10 The next question is from Martin T. Thank you, Martin T. It says, can you please comment on the increase in net write offs? Did TIME FINANCE change the the lending requirements? I'll I'll take that one, Ed, if that's okay. Terms of the net write offs, as as I mentioned, they increased from FY twenty's levels of about 1.3% to about 1.6 in FY '21. I'd I'd probably say it's not a it's not a material increase, but it's it's not to be we didn't find that unexpected. Despite what we think is pretty robust underwriting and collections process and despite the support that was out there from the government through CBILS, bounce back loans, etcetera, etcetera, inevitably with the effects of the pandemic that that there would have been and were on the economy, not every business would have made it through.

34:06 And so that really is what happened. As I touched on earlier, hospitality was particularly hit, as we know, with restaurants and bars and coffee shops, etcetera, closing, and not all of them reopened. And so in inevitably, we did incur slightly higher write offs than before. I think the pleasing thing from our point of view is that they well, they went up. It wasn't a material increase, which a number of people feared back in, say, March, April, May 2020 when this this first arose. And as I say, we are now in a in a much stronger position moving forward. So, yeah, that in a nutshell, that's that's pretty much it. Unfortunately, not every business could survive. So write offs did increase. There was no change really in the lending requirements. If anything, we've tightened our credit criterias and our lending requirements during the pandemic, but we certainly didn't open the doors to to new types of business that we weren't experienced in. It was just the nature of the beast due to the pandemic.

35:10 The next question I'll read out, Ed, but I'll I'll I'll hand to you if that's okay. Simon c says, are there any plans to increase the range of products you offer to SMEs? I appreciate it's it's fairly comprehensive already. Ed? Yeah. It is it is fairly comprehensive for what we think is the first part of our organic plan. So there's absolutely nothing at this moment in time that we're looking to launch imminently, but I I would say that there's some adjacent products to what we already do that I'd look like to look into pursuing an an offering. So for example, trade finance where we fund imports against confirmed orders. It sits quite nicely with invoice finance. It's a very specific offering.

35:56 You need people that have got experience in that world, and that's something that we could we could look at, and I'd like to look at. Also, some bridging loans as well that I think appeals, and it it sits quite nicely with what we already do in terms of the commercial loan space. There's some good margins that we can make on that. And I think as the recovery starts to gather pace, there'll be opportunities in that world as well that we can do on our own balance sheet and and broke out. So there's a couple of examples there of products that are in my mind that we can offer that are adjacent to what we already do, but it's unlikely that we will launch anything completely new that isn't in line with, you know, small business lending.

36:41 And and we do have reasonable coverage of across those products already. So hopefully, answers the question. Thanks, Ed. Peter d asks, does the NatWest facility mean that there is no need for an equity raise unless there is an acquisition opportunity? Ed, would you like to take that, or do you want me to? And Yeah. No. I'm I'm happy to answer that, James, and and, you know, chip in if if I miss anything. Yeah. Just to clarify, the NatWest facility is is is really the same as as we've got with the the block funding facilities for the asset finance in the sense that it's available to us to draw down against funded business.

37:26 What what you can't do is just borrow that money and use it for whatever you want. You can only use it for the the products that we're we're providing. So if we take on more business, we have sufficient more than sufficient funding to draw down on in the invoice finance world through that NatWest facility, but it doesn't allow us to just use the capacity in that facility without providing client facilities to draw against it. I hope that make makes sense. Thanks. Okay. We got another question from Martin T. Following up on the capital allocation question, can you please elaborate on the strategic rationale behind not considering buybacks at any price, I. E, any undervaluation level?

38:18 Again, Ed, do you do you want me to take that, or do you want that? I'm happy Yeah. I'm happy for you to take that, James. It's more finance related question. Thanks. Yeah. I I suppose it's not to say we won't ever do any buybacks, but at the moment, we feel we are and have been undervalued for quite some time. And buying shares back, which we have done in the past, hasn't really impacted anything. As such, the decision of the board was that we feel we can get the best increase in shareholder value by growing the balance sheet. That's where we think the the real enhanced value will come. Obviously, that's not to say never. If if some the share price reached some crazy crazy point, you you never know. But there's no there's no cutoff in our minds at the moment. We'll address it as and when it happens that we would begin a buyback. Apologies if that's a bit vague, but it is very much use the capital that we have to grow this business to as large as we can over the short to medium time.

39:18 And and that's that's really what we're gonna do. Obviously, if there's a huge unexpected change one way or the other, then then we will be reassess we will reassess that, and we do every every month, every quarter. We have a look at where we are and what we're doing. But at the moment, it is focused purely on growing that balance sheet. We've then got a question from Colin c. There have been been large sales hire hirings. When do you expect these to show an upside in the figures, and why no published targets for each year up to the doubling of the book so that the progress can be measured? Ed, would would you be alright to hold the answer the first part on the on the sales hirings? Can I just quickly answer the point on the published targets? Sure. Just just for people out there, we do have a house broker, and we are followed by a couple of other analysts, and they have published forecasts for the next two or three years, and and they are out there.

40:18 So there are there are numbers out there by various analysts. So I just wanted to clarify that. Eddie, are are you able to take the point on the on the hirings and when the upsides might be seen? Yep. Certainly. Well, like everyone, we want to see the upsides as soon as possible. That's the simple answer. The practical reality is that people do take a bit of time to to bed in. But I I would say after three months, we should start to see some impacts on on the numbers. Typically, it it it could be a little bit shorter. It could be a little bit longer. It obviously depends on the market conditions as well, but let's assume that they're they're starting to come back and and and they they stay that way between now and Christmas. I would I would hope that that that impacts of the investment on new business is starting to to show through by then.

41:09 At James, I might just there's a final question that's just popped in, so I'll just let you review that in case that's Sorry. Yes. And Martin T again. What is the target return on capital you aim to achieve with the new midterm strategy? In 2018, the ratio was around 15%, and it is currently in the low single digits. Eddie, are you happy if I talk about that? Or Yeah. Yeah. Again, I suppose this this leak links into the forecasts, which, as I touched on, are are out there under the under the brokers that have published. And if you look at those, you can see that as as as we've alluded to that we are aiming to get back to and beyond pre COVID levels. Once we are at that point, you will we will see return on net assets, net tangible assets, etcetera, back up to similar mid to high teens as as they were before.

42:16 James, Ed, thank you very much. And obviously, you to all those investors that have taken time to submit questions today. But you've been very generous. Every question that's been submitted, you have responded to. So thank you both to you. I know investor feedback is important, and I'll shortly redirect investors to provide you with their thoughts and expectations. But before doing so, Ed, perhaps I could just hand back to you just for a few closing comments. And then as I say, I'll redirect investors to give you their feedback. Yeah. Thank you. Well, yeah, I mean, as I as I said, really, in the summary, I think the the pandemic has taken its its toll on many businesses, and and we're no exception. We we have used that time to deliver what we believe now to be a sensible plan to move forward. And we're pretty much, you know, I would say, well progressed now in in making sure that it sets up the business to deliver on that plan, and we've started to do so. So I think, as I said in in the report and accounts in my my section, I would look look forward with a a sense of optimism, particularly if we see the the pipelines that we've seen over the last few weeks continue to build and and business confidence start to to build over a more sustained period.

43:32 And I would say that's really between now and Christmas. So I think the the business is well set up to deliver its plan and deliver success over the the period that we've set out, which is our four year plan. Ed, James, thank you once again for updating investors this afternoon. Could I please ask investors not to close this session as we'll now automatically redirect you for the opportunity to provide your feedback in order the management team can better understand your views and expectations. This will only take a few moments to complete, but I'm sure will be greatly valued by the company. On behalf of the management team of TIME FINANCE PLC, we'd like to thank you very much for attending today's presentation. That now concludes today's session. Good afternoon to you all.