Zinc Media Group (LSE:ZIN) — Investor Presentation relating to the recent trading update

0:02 Good morning, ladies and gentlemen, and welcome to the ZINC MEDIA GROUP, Investor Presentation. Throughout this presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time via the Q and A tab situated on the right hand corner of your screen. Just simply type in your question in the box below and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it's appropriate to do so. These will be available to you via your Investor Me company dashboard,

0:35 and we will send you an e mail to notify you when they're ready. I'd also like to remind you that this presentation is being recorded. Before we begin, we'd like to submit the following poll and be grateful for your attention. And I'd now like to hand over to Mark Browning, CEO and Will Sawyer, CFO of ZINC Media. Good morning to you both. Good morning. Thank you. Good morning, everybody. Good to good to e meet you, although I can't see you yet. But my name is Mark. Yeah. Mark Browning. I'm the CEO of ZINC MEDIA GROUP, and it's good to have your time this morning. I'm gonna update you on bits of progress around

1:07 the group since we last met in November. Only November, but it does feel a long time ago, isn't it? So lots to get through.

1:17 Just to kick off on some of the highlights, really, from the RNS that we released a few weeks ago. Good progress was made towards the second half of twenty twenty. Momentum was definitely building in the run up to Christmas. We booked 5,100,000 of new business into 2021 and are sitting on just under 10,000,000 as we start the year then. So h 01/2020, if you remember, revenues were significantly reduced, significantly down because of lockdown in March last year. If you recall, they were 7,200,000. That was 50% down on the first half of twenty nineteen. The good news, though, is that second half of twenty twenty saw those revenues, improve, and we'll report on those, in our annual results in April.

2:09 Revenues not back to pre COVID levels, understandably, but a much better second half of the year compared to the first half of the year. Revenue diversification, that's going well. That's a critical part of our four point transformation plan, that we laid out, when I joined. So we're winning new business from new buyers, and I'll give you more on that in a moment. Returning series, they are they are critical for future success. So we have now seven returning series already confirmed to 2021, and I've got a few more, insights in there to come. The pipeline is really healthy, actually. I'll do a full sort of report on the pipeline. And unlike March last year, this lockdown, TV, film production is allowed to continue, but there is clearly uncertainty, and COVID presents really the biggest risk to the group.

2:58 But all the critical elements that prevented the group from being profitable in the past have been fixed. We know why it wasn't profitable. We fixed the issues. We're winning business now profitably, but not yet at the levels needed, obviously, because of COVID. And once COVID recovery comes, we really are well placed to go forward. So let's turn to the the next slide. Let me just find where that there we go. Just lost my mouse for a second. So those who weren't here last time or perhaps you're new to ZINC, let me just introduce myself, and Will. I've helped two large organizations move from a position of underperformance to high performance, and I've run creative led businesses now for over twenty years. And the issues ZINC faces are very similar to the issues ITN faced when Will and I joined them in 2009.

3:48 And the reason ZINC wasn't able to deliver profit and cash despite revenues of nearly 30,000,000 was because margins were too low. It carried a degree of unnecessary cost, not much for some, and had at least two loss making businesses, which were a drag on the profitability. We have fixed those underlying problems, but the pandemic now clearly has hit revenues. The other similarity, which is critical between ZINC and ITN, is that both had both have TV production at their core. But at ITN, we diversified the revenue streams into other televisual content in video content marketing, video marketing, branded content, corporate video. And we're doing the same with ZINC. And we're here for the turnaround.

4:35 We left somewhere bigger to come to somewhere smaller because it has greater potential, and we want to grow it. And for us and for you, this is about value creation. We're aligned in the ambition, the long term ambition we have, and the potential we see in this organization going forward. So let's talk about new business, revenue diversification, and returning series because that's critical to the growth. Let me just give you a bit more color on the business we won that we talked about in the RNS since we last met in November. We have new returning series in 2021 with the likes of Britain's got Britain's lost masterpieces, grand tours of Scottish locks, crime files, inside the zoo. That's the the penguin picture, Edinburgh Zoo. Inside Edinburgh Zoo, it's a turn program. We've got a new BBC one talent led series. We can't can't put a still up. I can't talk about that yet because the BBC aren't ready to do so, but it's a a prime time BBC one talent led commission. It's gonna go into production in a couple of months' time. A new series for w, which is part of UK TV's stable, and a panorama, which is in production at the moment, and a significant new commission from Amazon Audible.

5:51 It's significant because of its value and the strategic opportunity it opens up for further work with with the Amazon group. It's a client I've bought over from ITN. They only commission four or five big series a year, and they are spending television budgets. And this is one of them. So they've given us one of their four or five big ticket items as our first. And it shows the benefit, the Audible win, of the structural changes that we made last year. It's an audio commission, but it came from telly. Came from the TV departments, and it came from joined up working. It sits on the same workflows as TV. It shares the same resource. So it's a good illustration of the changes we made last year and then starting to bear fruit.

6:38 Just a bit about the group. Revenue diversification is is is a cornerstone of the transformation plan. We booked 2,200,000 of revenue last year, and it came from clients. So of last year's revenue, 2.2 came from clients that ZINC's never worked with before. That's critical. It's a critical KPI that we're opening up new buyers. And the likes of a and e and France twenty four are in there. And we've got new commissioning departments too. We have a tracker internally that talks about both channels that are new, but also departments within channels that we never work with. So within the BBC, it's it's huge, of course. You wanna be looking for new areas to open up. Same with channel four. And we've booked nearly £750,000 last year from two new departments that we've never worked with before in BBC religion ethics and channel four features.

7:30 And a number of new clients in the pipeline, which I'll share in a moment. ZINC communicate, the new ZINC communicate, again, is winning new business with new partners, and I worked with some of these at ITN too. So we're doing well both in winning new business from new partners, but also in the conversations and the pipeline we're developing with them. On revenue diversification, just to give you a sense of the buyers that we are looking to strategically develop over the year ahead from a a wide range of price points in the lower price brackets. This is for television where buy buyers buy in higher volume. We've got potential work in our pipeline with more UK TV channels. I've listed some on the title slide there.

8:19 And with channel five and the Viacom stable. In the mid price bracket, there's ideas in

8:24 with Sky and some of the Discovery channels. It was a big team meeting only yesterday with a large contingent from Discovery and pretty much all of our sellers here. And then in the premium price bracket with the SVODs, we obviously work with Disney plus with Nat Geo, and we've got two projects in with them. We have three in with Netflix, one with Apple. What I'm looking to do is I look around the group. I go, are we touching all the right price points? Are we having new conversations and reassuring our core, but always looking to develop out? And there's been significant progress around the group on that strategic priority. Just wanna touch on returning series. They're critical critical for long term success of the group.

9:12 And this is a case study that I've taken from TERN that shows the importance of returning series. This looks at turn over the last six years. The green element of the bar, the green proportion, shows how much of their total turnover in any one year came from returning series, and you can see it's been building over the years. This doesn't necessarily mean that the program returned every year for six years. Although, to be fair, some do. They have got some fantastically long running returners. But it means that it returned from one year into at least the second year. And you'll see they've been steadily adding those as they've been building their business. The longest running returning series in turn is thirty years. It's the Beech Grove Garden, I found out fairly recently. It started in 1992.

9:59 So looking back at the revenue we won and we announced the 9.3 that we reported in the RNS recently, 4.2 of that is from returning series, which is exactly what you want it to be. Nearly 50% is coming from returning series, which is excellent. And as I look ahead, I reckon there's another three or four million of potential new business for this year that resides currently in in returning series that haven't yet been commissioned for 2021. But it demonstrates the importance of it, and it demonstrates our success at developing those titles and those long running returnable series that give us the the underlying confidence and the build from year to year. February is gonna be a very busy month on TV for television made by the ZINC Group.

10:49 We have 10 new original TV programs scheduled to go on air this month. That's before repeats. There's there's all sorts of repeats going around as well, but 10 new original programs. All of these were filmed last year during the pretty much the worst of the COVID crisis. I won't go through all of them, but if you wanna see more about ZINC MEDIA television and when it's scheduled, I do urge you to follow follow our social media feeds, and we tend to promote all of them on there or re repromote them if they're promoted by the channels. So from London, a brilliant new drama documentary for BBC one, on the Blitz coming up, and an amazing access documentary for BBC two, which charts Trump's foreign policy adventures, I suppose you'd call them, but his foreign policy issues over the last couple of years with contributors, amazing cast of contributors, really senior contributors from around the world, from inside the White House, people from Europe, China, contributors from Asia, and Korea. And I I use it as an illustration. This was a this was a program that was put together in in effect COVID in lockdown.

12:03 So we've the fact we've managed to to produce it without having to travel around to Europe, China, Asia, and Korea demonstrates we found new workflows for continuing to make complicated but highly impactful television. There's another program coming down the line in February on the fall of Gaddafi's regime to what we call in television blue light series. One called critical incident on BBC one and code zero on channel five. Another program on air at the moment is bargain loving Brits. It's on air on channel five on Sunday nights. It's performing well in the ratings. It's a regular returning series. And then from Tern in February, they've got Britain's Lost Masterpieces going on air. Darren McGarvey's Class Wars, Secret Life of Sewage, second series of that, and religious program called reflections at the quay.

12:54 So lots and lots of ZINC television going on. And I thought we haven't ever played or celebrated the content, but I wanna play you one program from from that list, which is this BBC one primetime blitz program. It was originally conceived as a two part program to one hours, but it was shortened to a single ninety minutes due to COVID. The cost of production have increased significantly as a result of COVID. There were originally delays, and way back last year, we talked about production that had been delayed because of lockdown one. This was one of those. But when we got back into production, of course, whole new set of protocols needed to be put in place around social distancing and quarantining cast and crew and testing and so forth. This program has a quite a lot of drama reconstruction.

13:44 And insurance at the time was a challenge, but we now have insurance in place. So the industry has really found a way forward of making this more complicated premium TV. But the BBC wouldn't increase the budget to cover the cost of all that. So after lots of toing and froing, we agreed that we would keep, in effect, the budget the same. But instead of having two one hours, it is now one ninety minute. It's due to go out at 08:30 in a week or two's time. It's prime time BBC one. So let's take a look. During the Second World War, German planes dropped 32,000 tons of bombs on British cities.

14:30 From Clydebank to Coventry, Liverpool to London in an eight month onslaught known as the Blitz. The resilience shown by the British people in the face of this horror would become known as Blitz Spirit. It's often held up as a sort of benchmark of Britishness, something we can call upon in times of crisis. But I think it's important to understand just how much of this is really true. Nearly

15:09 every street had a house in flames, dead and dying on the pavements, frantic parents searching for their young. Through the experiences of six real people, I'm going to show you what living through the Blitz was really like. It was really heartbreaking. You know, sooner would a fire be got under, then it would be hit to start again. And they're going to tell you their stories in their own words. I had absolute conviction that my number would be on one of those bombs. In a national crisis Roger. Roger. They volunteered for roles that would put them on the front line of a bloody and terrifying war.

15:57 We crouched in doorways thinking the next one must get us. And it will cost some of them their lives. Blitz spirit is only part of the story. I want to show you why we remember what we do and what's been left out. Because this chapter in our history has never been more worthy of a closer look.

16:38 So as I say, that's on BBC one in the next couple of weeks. And if you think you know everything there is to know about Blitz, when I watched it, I have to confess, I did I did think what's new. There's lots of new stuff. The parallels actually with with COVID, you know, they're not overt in the program, but you can't help but draw the parallels out. And and to to to hear some of the insights and some of the wrestling that the government was doing at the time with the people and the press around the decision making and the speed of decision making, and I won't give you some of the the juicy insights that the program throws up. It was a fascinating watch and brilliantly produced and a program that was made at the height of the pandemic last year. So just wanna recap on some of the restructure that we've done for those that are new to this group and to this presentation.

17:32 We've simplified the group into a cohesive content creating business in television and in ZINC MUNICATE. And the primary difference between these two elements of our divisions of our groups is the buyer. One is a commissioner in a channel in the case of television. And in ZINC communicate, the buyer is perhaps a chief marketing officer or CEO, but they both want televisual content. And what we've got now is this dynamic going on between the the the skills in the group where, commercial support is coming from ZINC MEDIA to the television business. And from the television business, you've got the reputation and the creative firepower. And the two parts support each other. They then sit on the same spine, the same backbone, the same workflows, the shared customers, the same propositions.

18:20 That is how we end up pitching and winning work like Amazon Audible. So it's an it's a cleaner group to understand. And in television, we work under labels to help customers and commissioners understand our product offering. And in ZINC communicate, we have three products in digital publishing, branded content, and video marketing. It is a premium group. It's highly respected, highly regarded. It works with all The UK PSP channels, and we're increasingly working with big international ones as well. And it's award winning. You know? And that's important. It doesn't pay the bills, but it does give credibility, prestige, confidence to existing buyers and to new buyers. We had the four point plan for our transformation plan. It's critical, that we remind ourselves of these, and, they are they are the key elements that have been delivered that will mean we can be confident about future growth and profitability.

19:23 These were laid out at the back end of twenty nineteen,

19:27 and margin improvements was one of the reasons the group was not able to deliver profit and cash. And now we know we've improved them. We now win and make TV profitably. We're not winning enough of it because of COVID and the market suppression that's called, but where we win it, we now make it and deliver it profitable.

19:49 We know which businesses were loss making, and we have restructured or closed them. These two changes alone would give us a £1,300,000 positive swing on like for like revenues, and we've taken out other costs too. So we've tracked these. We've reported on these on every conversation, and every single person in the company knows that these were the four critical strategic priorities for the transformation plan. We made a 143 of television that was transmitted.

20:21 We made more television than in 2020, but that's transmitted television. Hundred and forty three hours of transmitted TV in 2020. We've moved ZINC MUNICATE into more lucrative markets. We've hired new people. We've launched a new label in red sauce. We've built a new post facility, which has improved our margins. We've changed the culture to an enterprise culture, a high performance reward culture. So we need to ride out this COVID period and prepare for when restrictions lift and get back into full production and deliver the success that everybody, has worked so hard for and has been a long time coming. I wanna talk about our people because people power the performance of this group. There are five pillars of performance and talent management that I've shared with the whole company in January.

21:12 We have an ambition in this group to be a significant media group. To do this, we need to attract the right talent, develop it, retain it so that we can drive forward on our growth trajectory. And underpinning everything is a principle of professionalizing everything we do. The aim now is to is to kind of intentionally design every interaction that an employee has from the moment they first discover this group, which typically might be on social media or website. And our and and our social media and websites are not good enough, and they will be repositioned in February all the way through their journey through the company. So onboarding, we need better processes, better visibility, better consistency in how we recruit, finding new voices, new people, and so that they join with the highest chance of success. We've improved this, and we're gonna do more. On our compliance and governance, We're now putting in single approaches across the group to this area, single policies, better training, more reliable tools, but better people management information at our fingertips so we can make fast, incisive, smart decisions.

22:21 Performance management now underpins everything. A rigorous performance management culture is now in place. Everybody knows what success looks like. They know what success looks like. It's objective driven. And we've put in place a lot of support for people, over the last year, a raft of initiatives in the last twelve months to show that we know all of our staff and our freelancers. We have mental health training. We've launched employee assistance programs that helps people with debt or landlord issues or or or stress or counseling. We've got support seminars for home working, for parents working, and all sorts of things. And diversity and inclusion is the fifth pillar. In a good creative business, the more diverse the workforce, the more successful the company.

23:12 It's an area that the UK PSB's particularly pushing, and we now have a full diversity and inclusion strategy in place across the group. Some of the new people that are joining us, it's a it's a changing company. It's it's being renewed as you were from from the inside. We've reduced ZINC's total headcount last year by 20%. We now have around a 100 staff, and depending on what's in production and what's going on, we may have another 100 or so freelancers. Staff turnover last year was 30%. It's high, but it's necessarily high if we're to make the radical changes needed to bring a future success and build high performance.

23:58 Of those that are retained in the group, just over half have over five years service. So we've got a lot of familiar faces, but we've retained the critical knowledge. And that's the fine balance to have. This year, 2021, I think our headcount will increase again with the vast majority of these hires being in new business winning roles. So we are in effect, we're reorientating reorientating the group to be a more sales driven culture, sales driven organization, sort of creatively led, commercially driven. That'd be how I would articulate it, how I do articulate it. One new hire is a new chief techno technology officer role.

24:44 Look. We're first and foremost, aren't we? We're a content making group. Everything we do, though, relies on outstanding tech to make and deliver it. So good tech can good technology helps helps helps us win business. It helps us innovate. It gives us that competitive advantage. It builds resilience and so forth. And Ollie Strauss worked with me at ITN.

25:06 I know him well. He saves money, and he wins new business. He's an innovator. One of the significant bits of business that we won at ITN was in sport, and it came from our technology department. In the latter days when Ollie and I were together, we won business from third party clients. And Ollie has taken that forward and and has picked up business as a production supplier of technical services.

25:32 Even though programs like I'm a Celebrity and Dancing on Ice are not made by ITN, He won the contract to post produce those this year. He also got ITN onto Netflix's approved supplier service because of the technical skills Netflix demand. So this is an important hire. It underpins everything we do. We can be much, much better at it, and it can drive performance. So he joins in the summer. Just a bit on the market and the outlook. There's no denying it. Lockdown three presents new risk to the first half of the year. We ended the year with increasing momentum. We had our big gathering. We had our strategy away there. We could see the plan for 2021, and I think we all felt kind of much more optimistic. So the November, December time, then Christmas came and the lockdown came and the, you know, the new variant kicked in.

26:23 And, obviously, we've we've all had to be locked down since. The issue isn't our our pipelines or our ability to to come up with new ideas or pitch new ideas or or or anything else. It's the speed of decision making, actually, in the market with the channels and the commissioners. That new commission I mentioned at the start with w, that has been on and off and on and off for so many, many months. Actually, we committed that to the channel back in February 2020.

26:48 And normally, that would have taken five or six months at most, and it's now finally commissioned almost a year later. But production can continue. We're in production with 19 shows across the group. We know how to film in COVID now. We're insurance is in place. So the performance this year has to be better than last year. The issue is often about accessing subject matter. It's accessing places, institutions, people. You know, we do need in a factual we need to get to places. We need to get into institutions. We need to work with people. And contributors are worried about COVID, especially the older groups. That will obviously come through now as the vaccine rolls out. And some of our programs require us working with people like emergency services or rescue workers. So just take emergency helicopter medics, a turn program. It's commissioned for this year.

27:36 We've got lots of of emergency helicopter crews wanting to work with this, but it needs it needs filming with people who are vulnerable in tight spaces. And it's had to be it was scheduled to start very soon. Had to be pushed back a few months perfectly reasonably. We'll still complete it in this year. But that's the sort of illustration of some of the challenges we're facing. But as you've seen with Blitz, you know, we can we can make TV under the under the new world. So we book revenue in this group on activity. So it's important that we get the market moving again because we can't book it. We can't invoice for it. We can't get the cash in unless the activity's going on. And that's where COVID really does have an impact. The restrictions on international travel are not a huge problem for those that might be wondering. We just finished this Trump program largely shot, as I say, in all those international places without sending any of our people anywhere, all now done remotely with with new technology and with local crews.

28:34 I used this slide last time just very briefly to remind everyone really of our ambition and the opportunity. This is where we sit as a group in the market. We do have long term ambition to be a top five club, to use a sort of Premier League analogy. There's opportunity to scale this group. We are ambitious, and I'm incentivized, and Will's incentivized on value creation. And the market does provide good opportunity when the time is right for us to scale and create that value. Just finally on the TV market. At some point in 2020, content dam that has been building up and building up as channels have had to go turn to repeats and catalogs to fill their schedules, that dam will burst. There is a growing need for new original content. I think the top quote here from TBI perhaps gives a sense of the macro market demand as it were. There's definitely short term issues affecting production, and they're well documented in the BBC or or looking at ITV who've had to push some of their big hits out again because they were due to be this half of the year. They've had to push them into next year. And we're you know, we have our fair share of of that too. But when you look at that TBI quote, unscripted products enjoying a surging demand, and that looks to continue.

29:57 We've got millions of pounds of programs in the marketplace. We need lockdown to end. We do need the recovery to begin. Let me just look at Sky, the comment there about them launching 50% more original programs in 2021. Look at the discovery one. We're commissioning more hours than anybody in the unscripted world now. I've picked those two channels out even before I these these comments were in February. You know, we've identified these channels last year. We've got good ideas with them. Let's hope that we can close some of those in the coming months ahead. This is our pipeline. This is critical. Critical for everybody to understand. It's transparent. We use it internally and share with you externally. We've got consistent systems now for getting the right kind of visibility on what our business looks like around the group in its simplest form.

30:48 These look at probabilities. This looks it's just a probability of winning business. In effect, the more advanced a conversation about a piece of business becomes, the higher the probability becomes that it will convert. So in effect, it's like a it's like a probability pyramid. So our teams now have really strict criteria to meet for a piece of business to qualify for each of these elements of the pipeline, for it to move from early discussion through to it being highly likely a piece of business has to pass a series of tests. And you'll see that back on the November 19, we had 11,000,000 in our highly advanced conversation gate. That's on the the the sort of slightly shaded out on the slide.

31:35 And by the January 14, about 6,000,000 of that had been closed. And if you were in the last presentation, I talked about that 11,000,000 going really seeing levels of activity and conversations that give me increasing confidence. The probability is we're gonna convert a chunk of that in the coming months. Actually, we we we converted a chunk of it before Christmas. And this included many of those programs that I mentioned on the first or second slide. So we need to see projects now, clearly, that are in the early discussions or engaged discussion gates to develop up the pipeline in the weeks and months ahead. And as this happens, so their probability of being commissioned increases, and so we win more business. I talked about the four key strategic performance criteria we had as the transformation plan that I set out when I joined the group. Margin management, were. Margin management, revenue growth, diversification, cultural creative renewal, creating that high performance reward culture, and investing in operational excellence.

32:34 These have all been delivered. So we need new ones. So we have five new strategic priorities for the group this year. Revenue. All the changes that we've made mean we know we can win business profitably, and we can be cash generative on twenty five million turnover when the group was loss making before on nearly 30. So all those efforts on new hires, new buyers, building the news in communicate business, we need COVID to pass. We need speed to return. We need confidence to return to the market. Margins remains a strategic priority. Maintaining our new improved margins and looking for further improvements as we go forward is the second priority.

33:20 Focus on cash generation. We need to continue to make short term in year investments in order to keep our eye on 2022 and 2023 as recovery and confidence returns. We have to be hiring people now. We have to be making those investments for the long term recovery of this group. Performance. Performance. Performance. Everything is about high performance. We've made big changes to culture and reward, how we reward it, how we measure it, how we lay it down so everybody knows what their roles are, what success looks like, and huge sea changes across the organization now aligns to this performance culture. And I'm putting shareholder communication in there. The group will be successful in these years to come.

34:06 It will be successful, even more successful, by creating that powerful partnership between our staff and our freelance community, obviously, with with the management teams and with our shareholders. When each constituent part works really harmony in harmony together, we've got a powerful opportunity here and play our part to that sort of future growth. I'm really, really passionate about aligning everybody to the same objectives, clear set of objectives, clear cultural improvements, and then we get all three elements of those working together. Gonna be some very much better days ahead in the years to come. So I think 2021 should get progressively better. Lockdown three, it's a pain. It's a pain, but it is what it is.

34:55 This is my third turnaround for those that don't know me, and experience helps me to recognize when a company reaches that natural inflection point, and ZINC has reached that point. We now make TV programs profitably. We've closed loss making businesses. We have the right people sitting in the right seats facing the right direction. COVID is delaying the fruits of this hard work, but the fruits will come. And I really genuinely believe, now that the company is in is much, much better shape than this time last year. And we'll get through COVID, revenues will recover. And when they do, we'll be profitable, and we'll generate cash because of all these changes that we've made. At some point, as I say, this content dam will burst. And if the Bank of England are right, it could be later this year. So I think we will come out of the crisis in much better shape than how we went in. We will, as it were, bounce back bigger.

35:49 Those are our main slides. Thank you very much indeed, Mark. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated on the right hand corner of the screen. We just while the company take a few moments to review those investor questions submitted today, I'd like to remind you that a recording of this presentation, along with a copy of the slides and the published Q and A, will be available via your Investor Meet company dashboard, and you will receive an e mail as soon as that is published. I'd also like to remind you that your feedback is important to the company. And immediately after this presentation is ended, you'll be redirected for the opportunity to provide feedback in order that the company can better understand your views and expectations and would very much welcome that if you could be so kind. Mark, Will, obviously, we had a number of questions that were presubmitted. And I thought if we could look at those ahead of the questions that have come in during the meeting itself.

36:41 The first question, the RNS talked about COVID presenting biggest risk to success, and I know you've touched on COVID in the presentation. But what's your latest thinking on this? And has anything changed since the last RNS release? Has anything changed? Well, the vaccine has has clearly given us grounds for increased optimism from spring, summer onwards. But I think sort of conversely, it does sound like I think when we went when we were releasing this back in the start of January, we were looking at things. You know, the the government's guidance was we kind of will be back to more degree of normality by the February half terms. Clearly, two things have happened. I think we're gonna be suppressed for longer, but potentially recover quicker.

37:29 And that might mean that our ambitions for the first half of this year are gonna be suppressed in line with COVID. But we don't know. You know, we're we're as I say, we're in production on 19 shows, and we're winning business. So the sooner we're out of it, better, really. Thank you very much, indeed. The next question is when would you hope to have forecasts in the market? Well, Will, why don't you take that one? Yeah. Sure. So we will we'll release a forecast as soon as the COVID related uncertainty has reduced sufficiently. We were actually due to release a forecast last April, but then COVID took hold in March. It now makes sense that we do so once the market's more settled, when there's more short term visibility.

38:16 And we've we've obviously got a clear view on on where we're taking the business. We've got the building blocks in place to be sustainably profitable. Of course, there's uncertainty around the when due to COVID, but we absolutely recognize the importance of providing the market with forecasts and and rest assured it it is high upon our agenda. Oh, look. I'd I wish we could put forecasts out. It's just what it's in it's just impossible at the moment, but I there've been two or three moments where I would've been so much help helpful to what we could've done. But they're not gonna they're gonna change so quickly at the moment as Will says. But you get my sentiment. It's just a huge frustration from my point of view that we can't do that. Thank you very much indeed. The next question is all around the question around Amazon. It's great to see that you won a podcast commission from Amazon Audible.

39:03 What's your strategy for your radio business? And how does the Amazon Audible commission help you win commissions with Amazon TV? So I think it does present an opportunity to review. We've got two radio businesses, typically, providing the fact that the radio business is some might say is a bit old school than it is, but they they serve radio four, really. And I think this provides an opportunity for us to look at this whole area. So there's a big piece of strategic work we're doing at the moment in the area of audio and podcasting and streaming and so forth, which I have a copy of. It's all 76 pages long. So and let's get my head around it. And I think this opportunity does give us a chance to relook at that space for ZINC. The fact that that I that we've been successful both in a big buyer, and there are other buyers in this new world, but also using the machine that is constantly churning out these great ideas. And we all know in TV, there's you know, for everything that gets commissioned, there's probably a 100 ideas that, for whatever reason, didn't make it.

40:09 So let's find new places to take those. So I well, there there will be a piece of work going on. There is a piece of work being on to to sort of strategically review how we use how we benefit from the boom in audio and podcasting. And within the Amazon family, a colleague of mine that I hired at ITN is now one of the senior commissions at Amazon UK. I do talk to him regularly. Their focus at the moment has has been outside of our genres and our expertise, but it's moving, and they've hired some new people. And clearly, when you're in the family, and we are now with the Audible group, it's much easier to to have these conversations where it sort of oils the wheels of those conversations. So, yeah, we've got they are on our watch list along with many of the other s bots as well. You gotta find the right project. They can waste quite a lot of time and effort otherwise. It's all about ruthless prioritization and where the biggest chance for for for relatively quick payback comes from.

41:02 Thank you very much indeed, Mark. Mark, I wanted to pick up on the next question and really tie that in with a question that's come in the live event from Stuart E. Stuart asks, are there any small companies that you could acquire and bolt on and kind of how would you fund them? And then the pre submitted question very similar, are acquisitions on the agenda at some point? So perhaps we can combine those two given they're of a similar nature. Well, what's on the agenda is to to grow into a significant media group. Some of that will be organic. Some of that could be acquisition. And in order to develop that properly as a strategy, we are having lots of conversations and looking at lots of ways that we can do deliver on that ultimate ambition.

41:52 The market has, yeah, lots of small TV companies, but I'm also looking at the ZINC communicate side where there are content making companies that are synergistic to the premium side of TV. Quite a lot of content marketing companies would love to have the prestige of television in their toolkit. And I think TV indies like ours would love to have some of their high margin revenue, I love that mix. So I think we gotta look at all these options, but keep day to day focused on building back the business as a result of COVID and generating a healthy core business and then scale. And the market would support that. There's no question it would support it. I think, you know, you gotta be you gotta be you've been looking carefully at where ZINC has had not a not a particularly successful road in buying in businesses and continuing to build them with the exception of Turner.

42:48 So I've got a clear view in my mind as to how we would go forward in that space, but we've gotta we've gotta make sure we get through this short term crisis first. Thank you. And I guess the final question that that was presubmitted. In some of the online chat rooms, there appears to be a lot of positive but also negative sentiment. Why do you think that is? Well, I mean, I think ZINC had a very difficult decade. It's underperformed. So I completely empathize and understand that there will be all sorts of historical frustrations, anger, annoyance, disappointment, whatever it is, with investors. I mean, that's perfectly reasonable. It's it's terrible, but we've gotta resolve it. And all we can do is look forward about that.

43:41 And I come back to my point that I think the more we can the more we can be clear on our strategy, the more that we can improve our dialogue, the more that we can get the really key wheels turning here between investor support, staff clarity of purpose, clear management, and leadership, the more successful the group will be. I mean, there's not a lot of point in raking over old calls. It is what it is. And I appreciate that, you know, there's lots you know, a company that's been around this long has lots of people who've passed through it for good and bad. And everyone's entitled to their view on that. But all I'm focused on is moving us forward and building a high performing business that brings shareholder value. That is what we're for, that's about the future, not the past. So I totally understand if there's pain, frustration, anger, remorse, all the rest of it.

44:26 But let's focus that to how we go forward and how we build success in in our teams, in our people, in our creativity, and for our shareholders. Thank you very much. So that deals with those questions received ahead of today's event. If I could ask you just to click on the Q and A tab, Mark, and perhaps if I could ask you to start at the top. Thank you, obviously, to all the investors for submitting their questions. Mark, if I could ask you to read out the question, perhaps who it's from and where appropriate, give your answer. And then I'll pick up from you at the end. Sure. I'll just read them all. That's fine. Let's go through it. So first one from Mark w. Can you please elaborate on future funding needs? Well, we are you know, we we're fully funded at the moment. We did the raise in November, and we modeled various scenarios in order to go forward with shareholders on that, worst case and mid case and upside case.

45:25 So there's nothing more to say on that at the moment. We've got our plan in place. Our balance sheet has been significantly improved over the course of 2020 with all the changes we made and and some of the significant structural changes we made. We're well placed for cash at the moment as we reported in in h two. So nothing more to say on that other than we're in a good position. Mark, I'll just spin over your other two questions just to give everyone else a chance to have a question asked. We've asked one of we've asked one of Stuart. So let me just see Philip s here. TV production has been going ahead during all the lock downs using virtual production, filming, direction, editing. What are you doing to address the potential for removing capital overheads? Well, we did remove a lot of capital overheads with some of the changes we made last year.

46:15 You know, we moved premises, for example, from a totally inappropriate premises to a much more suitable location, and we saved, you know, over a $100 in doing so. We've put in an awful lot of new kit, which has allowed us to take out other costs. And the and you're right. Sure. The future is actually remote production, which is one of the reasons I've made an investment in a CTO. And the CTO needs to come in now and look at all the areas where we currently have workflows that can be cheaper, smarter, better, remote, particularly with nations and regions. You know, we are a group that has a very strong portfolio around The UK with premises and people and workflows in Aberdeen and Glasgow and Belfast and Manchester and Macclesfield and London. And, you know, I will be tasking the CTO with looking at all of that and finding ways of being more efficient, both for the benefit of better product, but also for cost reduction.

47:14 Abby r, does the business need further investments? I think I've answered that in in the short term. The answer is no, but we are ambitious. Reginald h, does the business model enable you to make revenues from secondhand sales repeats, iPlayers, catch up TV, DVD sales, etcetera, etcetera? Yes. It does. I mean, just a bit about that. That's about our IP, our rights, And the way it typically works with The UK PSBs is that the model is they they commission you to produce the program, and they have the rights in The UK, and then you have the right to exploit that outside The UK internationally. We do exploit that. We have a we have a deal with BBC Studios. We're the largest distributor in The UK in terms of the largest catalog. They pay us a a a guaranteed amount, and they have the chance to take the best and the first pickings from our library of programs where those rights are available for international exploitation. But we work with all sorts of other companies as well.

48:16 And the and often when a broadcast in our commissions, they you know, their rights to include their iPlayers and so forth. So eventually, the rights will come back to the to the Indian. We have the right to sell them onwards again at the end of a window. In terms of DVD sales and so forth, that market's not a market we're we're in. It's not particularly it's not particularly lucrative anymore. Reggie, I've asked another Reggie's asked a second one. Derek, what percentage increase in costs has COVID imposed? Have you been able to achieve some efficiencies under COVID? Yeah. That's a good question. I don't I I couldn't pull you out a specific figure. I mean, I've given you an inclination here of some of the costs that COVID brings to productions, which broadcasters and us wrestle with day in, day out, PPE, testing, quarantining, all the kind of rigmarole that comes with the new workflows.

49:04 But that's all part of just a now a new budgeting process. And equally, there are bits in budgets now that that don't we don't travel so much. Airlines tickets have gone down. You know, travel accommodation, entertaining, all that sort of stuff's come down. So there's definitely savings in those areas, but other costs in other areas. Right, Jonathan. Given the pickup in activity and optimism go through to finance production sufficiently, will you use external production finance? What's the likely margin you'll have to pay? Just to to pick out a few things from that, Jonathan. So give given the pickup in activity and your optimism on growth, will you be able to finance production sufficiently? Second question, will you use external production finance, and what is the likely percent you have to pay on that? The way the way it works is that programs with with one exception, which I'll I'll talk about, which is ITV.

49:55 When a when a broadcaster commissions us, they, in effect, they pay for that production in key milestones as you go through. So they in effect, it's cash flow through the production if they pay their bills on time. But the agreement is that they cash flow the production. So, typically, we'll get a commission, and on signature of the contract, a first tranche of a payment is made. And then on the delivery or the first cuts or the viewings, a second tranche is made and so forth and so forth. And then eventually, you get your final amount on delivery of all the paperwork and all the rest of it. So so a production company like us, we don't have to finance programs in order to make them, providing the broadcasters pay on time, and many of them don't. And some of the international ones are truly terrible, which causes a problem, especially if they're paying if they're decommissioning you for a really big show like Nat Geo do, and then they don't pay their bills on time.

50:48 The other exception is ITV. They don't work like that, but they do pay the cost of finance for a program if you go that way. Will, do you wanna jump in on that with anything? No. I mean, that's it. That that we're not we we don't envisage using any external production finance at the moment, but it does depend on if it's an ITV commission or the odd international broadcaster who pays at the end of a production, and they're the they're the early times that we'd expect to. Two questions from Glen. One of them is you have diluted shareholders since you became CEO. So are you just blaming COVID for the poor performance?

51:38 I don't think I'm blaming anything. I'm to give you context and understanding, transparency as to where the group is. Of course, you know, this group has been a a financially distressed group for over a decade. In order to get out of that, we've had to go to shareholders and ask for support. And that's about the partnership. Here's a plan. Here's a management team. We know how to turn businesses around. Here's the reason the group has not been successful in the past, which is a big part of it. I hope people understand why the company wasn't able to make profits and cash generation of £29,000,000. And I've told you the reasons why, and they're fixed. And it's it's of course, it's hugely disappointing when you put a plan in place like that, that the one thing that actually was strong about the group, which was growing revenues, has now been impacted by COVID. So we've got we had two big challenges here, resolving the problems of the past and now operating under a suppressed marketplace.

52:44 This is a long term plan. You gotta see it as a long term plan, and no one wants to take dilution. Totally understand that. And I'm the same because I put in my own money in each of these slogs each time too. So there is alignment there, and there's shared pain and shared opportunity. So it's not about blaming anything. It's about giving context, I hope I've done. Mick b. I'm just trying to make sure everyone gets a question answered here. Short term, there is a massive overhang of stock. Is this from the large fundraising last year? Can anything be done to increase interest in the shares as current volumes are close to zero every week? Well, I hope this is part of that. I hope this this regular dialogue and telling our story, explaining our journey, laying out the vision is part of increasing the interest in ZINC as a stock in a opportunity for growth and in a turnaround investment story. So that's why we're doing what we do. We've we've asked and hired in the services of Dom Delmar to help us with that strategy, And we're acutely aware that and completely aligned and rewarded on in in incentivized by shareholder growth and price growth and market cap growth. So that's what this is all about. And this is the context that I'm trying to explain is where the problems were, how they've been fixed, and what the future looks like, and the key measures of success in the twelve months ahead.

54:08 Mark, it's I'm just mindful. Obviously, we're coming up to the hour, and I know that investor feedback is particularly important. And I know the views and expectations of all the investors that have taken time to attend this meeting today is important to you. So I'd like to perhaps redirect them. But before doing so, perhaps I could ask you just for a few words to wrap up. And to investors whose questions, I think, as Mark said, he's answered questions from pretty much everybody that submitted them. The company will be able to review all questions submitted today. And if there's any additional comments, obviously, we'll make those available via the platform. So perhaps for now, Mark, if I could hand back to you just to wrap up, and then I'll go over investors for feedback. Well, thank you for your time. Thank you for the time you've taken just to listen to our story and what we're up to. I hope it's helped. I'm really keen on transparency.

54:54 In every business I've turned around before, the the more we articulate what we're doing, how we're doing it, and where we're going right through the organization. And I have a simple test in this organization. I go up to people, and I meet all new starters within a month of them joining, and I explain our strategy. And I you probably wouldn't like this if you worked here, but I do sometimes discuss, just remind me of the strategy we're working on. What are the key strategic priorities? And more and more of the time now, everybody's articulating the same thing. That is critical because you're multi so very well a CEO having a plan, explain it. But when a 100 people do it, you're a 100 times more powerful. So I wanna thank you for your time for it. I hope this helps to explain what we're doing. I am genuinely increasingly optimistic about 2021 and 2022 as we look forward there. We've got good business in our pipelines, lots of conversations, great new clients teed up in the wings. And if the Bank of England's right, second half of this year and 2022 and beyond, we'll all be vaccinated every year going forward for the next few years, and we'll be able to build a long term successful group. So thanks for your time this morning. Appreciate it very much. Mark, Will, thank you very, very much indeed for updating investors today.

56:04 Could I please ask investors not to close this session as we will now automatically redirect you for the opportunity to provide your feedback? If you access this meeting from our website, then simply the feedback page will appear. If you access via the link sent to you by email, please just log back in and provide both Mark and Will your feedback. On behalf of the management team of the ZINC MEDIA GROUP, we'd like to thank you very much indeed for attending today's presentation. That now concludes today's session. Good afternoon nearly to you all. Thank you.