Ladies and gentlemen, thank you for your patience. This call will begin shortly. Hello, and welcome to the Accesso half year results, twenty twenty-four. My name is Elliot, and I'll be coordinating your call today. If you would like to register a question during today's event, please press star followed by one on your telephone keypad. Alternatively, you can submit your written questions via the webcast page. I would now like to hand over to Steve Brown, CEO. Please go ahead.
Hello, everyone, and thank you for joining us. I appreciate you taking the time to be here for our call as we walk through our interim results, and today, I think, you know, we made a trading update just a few weeks ago, so we're going to keep the detail, you know, a little high level and make sure we have plenty of time for questions as well, because I think you have the general headline from the results statement this morning, as well as the trading update we made, so I want to make sure we have plenty of time for a conversation. I want to start off by saying that I'm here this morning, and I'm joined by Matt Boyle, who today has been appointed as our new Chief Financial Officer.
So I want to welcome Matt into his role and, you know, Matt has been with us for five years. He was Fern's right hand, just as Fern was my right hand. So Matt and I are used to working in lockstep, and I'm very pleased to have him in this role. Today, as usual, we're going to walk through just a quick overview of our business. I'll hit some highlights in the operational performance. Matt will take us through the financials, and then we'll wrap up at the end with outlook, and then, of course, time for questions. I just want to start off on page four with a headline of the numbers, just to orient us all before we go into some of the detail.
So we finished the half year with $69 million, just over $69 million in revenue, which was an increase of 5% on 2023. But if you take out the adjustment for the seasonal labor that we no longer handled for our big customer, we're actually up almost 10% in revenue because that is an adjustment to you know, our comparables. We had $6.5 million of cash EBITDA, which is exactly in line with prior year. It's certainly lower than our expectations but that's primarily due to a timeline shift for a key installation project we're working on in the Middle East, which we'll talk more about in a moment. Our gross margin was just over 76%, a nice improvement over prior year, we were at 73.5%.
Of course, removing that, you know, essentially no margin pass through labor in our numbers is very helpful, and that is a part of our focus on revenue efficiency, making sure that the revenue we're looking at the top is flowing through to the bottom. And, you know, continuing to look through our business where we have opportunities, sometimes from acquisitions, you can have, you know, things in there that are not optimized from a margin perspective. So we just continue to work on tightening those things up to improve our margin. Our ticketing and distribution revenue was up 18%.
That was partially from our core ticketing, but also fairly significant growth in our Ingresso business, which we've been working hard on, kind of making some strategic repositioning work there since the fall of last year, and we're starting to see that come into play with some results. 85% repeatable revenue, again, underpinning our business. We have a very strong base of repeatable revenue, and that's remained constant, even with the acquisitions mixed into our numbers. Importantly, I want to share that if you take out the acquisition impacts, because, of course, we have more overheads coming in, our underlying overheads were up 4.3%. So just pointing out that our focus on cost management is continues to be a priority for us in regards to staffing as well as all other costs.
We won 21 new venues in the half year, slightly ahead of prior year, which was 16. We implemented 16 different venues across the period, and importantly, we had eight wins for our new Accesso Freedom platform. So that's just it in a nutshell. That's what we're going to talk about more as we go forward. So flipping now, just, you know, past page six, really, for the sake of time, just to remind everyone on page seven, and I won't go through this page in detail, but I just want to remind everyone that we really are focusing on our business in three main groups: ticketing, queuing, and restaurant and retail. So we're not really breaking down each one of the products in this overview.
As you can imagine, with all the acquisitions and products we have now, it should be a little complicated, but when you boil it down, it's really about ticketing, queuing, and restaurant and retail. Our geographical footprint is very broad. Both our products and our customer base are very distributed. Matt will share with us some impacts that our recent acquisitions have had on our mix of revenue as we continue to diversify around the globe. I want to spend some time talking on page about some industry trends, because as you think about our numbers and our trading update, you know, there might have been some concern or questions around what's going on in the world.
And I wanted to unpack that a bit for you here today to just give you our view on the underlying thoughts on the transactional demand in our business. So if you talk about theme parks and attractions first, you will see that the destination leisure sector was reporting and has been reporting a notable moderation of demand, as they might call it. And you know, most of these locations, you think about the big theme parks in Orlando as an example of the ones that have been reporting. They've basically been broadly even with prior year. Some a little down, some a little up, but more or less even with prior year. And of course, they would never expect their year on year to be flat. So for them, this is less than expected.
and makes their comparable to last year a little more challenging, as costs have increased, but their demand has not gone along with that. So what we see in the regional attractions is there actually is typically a substitution effect when the economy or, you know, those kinds of things kick into play, where consumers may shift their behaviors. And if you're not traveling as far away, taking big vacations, you tend to stay closer to home. And whether it's, you know, the economy or whatever may be happening that makes people stay closer to home, the regional attractions tend to benefit from that as customers trade off their visit to the larger destinations for a visit to, I don't know, the neighborhood Six Flags or the neighborhood Legoland, as an example.
If you look at what's happening across our portfolio, and I'm sharing publicly reported information, which is, you know, just to give us some insight. As you know, Cedar Fair and Six Flags merged at the beginning of July, just as our period was ending. When the legacy Cedar Fair side of the business reported their attendance at the half year, that was up 16% the prior year. When the Legacy Six Flags side of the business reported, they were roughly flat. They had some pretty significant weather impacts in the spring, and they also had cut some operating days, as well as they had the wraparound effect of a continued change to their membership program, which provided a significant amount of attendance.
So there's kind of a dichotomy here of what's happening between, you know, what was happening between these two operations. But I think it shows you that Cedar Fair, which did not have those same local impacts, and perhaps even had some different strategies around their go-to-market, actually was up 16%. So it's not all doom and gloom. They actually were doing quite well. And I think as Six Flags begins to see the benefit of their go-to-market strategies and the synergies from that begin to emerge, I think we'll see more consistency between what was two parts of the business. Of course, weather's always a factor, but also the operating calendar can be a factor. How you handle season pass programs can be a factor.
So a lot of things working in there, but I think it's important to point out that, you know, there, there's not the underlying trend, if you look at Cedar Fair, was actually up quite strong, which really is a validation of the substitution effect theory that you may hear we talk about often. The international venues. So it's not just the U.S. that we've been watching. The international venues have been very mixed, and it seems to vary by the venue types and also geographies. You know, some of the venues that we service the ticketing systems are destinations. So we have a big venue in Hawaii, for example. We have a notable roller coaster in Las Vegas. We're seeing some softness in those areas where those are more, you know, destinations that involve travel.
And so we see sort of, you know, inconsistency when you look down our report at the plus and minuses, but overall, I would say it's mixed, with some positives and some minuses, but that brings in the value of our diversification across geography and across customer types. So what we expect will happen in those destination resorts or destination venues is, they'll adjust their pricing, of course. They'll adjust their marketing to, you know, make sure they're keeping pace with what the consumers are expecting and what the consumers are willing to pay in those markets. When we think about North American ski, which, if you look at ski across our business, is a bit less than 20% of our overall revenue, so it's an important part of our business.
What happened at the end of 2023, going into 2024, was the snow conditions over the holiday period were very, very poor, and that's a super important time period for ski operators. The Christmas season, in particular, New Year's, that whole, that whole period in the U.S. is, is quite important in terms of revenue, it's tourists, it's higher pricing. So they had this incredible softness at the very beginning of the season, and then what happened was near the end of the season, they got late-season snow. So overall, they had a lot of pass holders coming in at that end, that last push, but they lost a lot of their valuable tourist visits, which were higher margin.
And so for them, in the U.S., you know, even though attendance was up by 6%, as reported by the association, their revenue was impacted because of this holiday period being, you know, being a bit rough. Canada saw the same thing. Canada, Western Canada, was down about 15% in attendance, and the Quebec area on the east side was down about 10%. Again, same factor of poor snow conditions. And so, you know, I think that is a factor of just, you know, we're in the Ski business. This will come and go. One year will be boom, one year may be a little soft, but the attendance actually held up. It was a matter of when the attendance came in and how that affected their profitability based upon, you know, what customers pay during different time periods.
So for us, what that means is if their revenue is slightly impacted, it could make them a little bit slower in making decisions about a new system. They just want to kind of wait and see a little bit. So that kind of plays into some of our go-to-market thinking as well. Accesso Paradox, which is our acquisition from last year, we finished that just, I guess, about June, May, June of last year. And we quickly jumped in and updated their e-commerce product because it was just not at the level we would expect. And we weren't able to rewrite it and give them a whole new platform yet, but we did a significant cleanup of their offering and included...
You know, we've added Accesso Pay, a whole range of updates, which have been very well received, and we saw the e-commerce volume in their business jump by 14%. So overall, I think we're very well positioned in the sector. We might need a little weather cooperation in this particular area, but I feel very comfortable around where we are sitting in the ski market. Live entertainment was actually down a bit for Accesso ShoWare, with the tourist venues that were more notably impacted. Again, as I was saying earlier, ShoWare serves some of those venues in Hawaii or Las Vegas. So, you know, that area could have some impact driven by those larger destination venues. Across the rest of it, again, it's kind of a mixed bag.
We see a lot of demand for live entertainment, you know, concerts, theater shows; all those are in strong position. But we do have a mix of business within Showware that does include some sort of tourist-type venues. Our ticket volume for Ingresso was actually up 25%. We added a new high-volume distributor, and we've also been working to fine-tune some of our pricing, some of our commercial arrangements, as well as just refining how we operate the business. For example, we exited our consumer direct side of that business. So overall, live entertainment, from our view, is actually, you know, from an Ingresso perspective, is actually very healthy, and I think ShoWare is gonna have a little bit of impact on these tourist destinations. But broadly speaking, on live entertainment, things look pretty good. So moving on to page 11.
How does that turn into what we do? I covered a little bit as we went, just to kind of make sure things were tied together. But here on page 11, I want to walk through some more of the specifics. So starting first with ticketing, the revenue from our core transactional products was actually ahead of prior year. Passport, Accesso Passport, was up more than 5%, and ShoWare's revenue was up more than 4%, even though the unit volume was down. We benefit from mix, we benefit from pricing, we benefit from new commercial arrangements. So overall, on the ticketing side, our transactional revenue, was actually ahead of prior year. So you might have expected from the trading statement, we might say it was behind.
We saw softness that didn't get us to where we wanted to be, but as a comparison to prior year, we actually were tracking ahead. We've also rolled out a new update across the estate for Passport for their e-commerce platform. It's a new UI/UX, where we really went through and just did a major overhaul of the aesthetics, but also the user flow, and as we roll that out to our various customers, we've done A/B testing to confirm each one of those rollouts, and we're seeing a revenue increase for the clients of around 4%. Of course, that can flow into us as well, where we gain a percentage of the revenue for the transactions.
We rolled out a new version of the point-of-sale for Passport, which was, you know, partially to update the technology, because these platforms do age, but also to provide a better user experience, and that has been very well received. When we talk about R&D, right, sometimes it's a lot of these kind of elements that really help us maintain the freshness and relevancy of our product. Things like updating the UI/UX, which took nearly two years of effort, rewriting the point-of-sale, which was a year of effort and fairly extensive development work on that. These are things that are underpinning our R&D. It's keeping that product fresh and keeping our big customers in particular, as well as the entire portfolio, very pleased with our offerings. We also brought Accesso ShoWare to the U.K. market.
We've just now started, you know, sort of selling and marketing that into the customer base there, which we think is a great opportunity as we establish, you know, the awareness and, you know, get a chance to be in front of customers and explain the product in more detail. I mentioned before, we've been making a range of strategic and operational changes in terms of Ingresso. We adjusted the leadership there. We've made some changes in terms of how we operate, what we operate, for example, exiting the consumer side of that business, which was essentially no margin or minus in some years. So we exited that. We actually transitioned that to one of our partners that was very eager to have that from the box office business. And so we protected profit, right?
But we moved the top-line revenue out to a customer that actually does that for a living from a consumer perspective. I think when we wrap up the year here, we're going to see the Ingresso, you know, bottom-line profitability be slightly better than probably it's been in years, I would expect, if things continue on the track we're expecting. We did have a shift in the timeline for a key Accesso Horizon project. We've mentioned that over and over again. You all may be getting tired of hearing that. But we have a large new customer in Saudi Arabia, and as projects do, their timeline for the build-out, the construction, whatever you may say, or just the decision process around when they want to open, has shifted.
And so that means that if their build-out timeline has moved, the implementation or the need for a system is also going to move with that. The contract is still there, the deal is intact, but the timing of when that rolls in has shifted, and it was a significant, you know, significant expectation for us, both in the first half of the year as well as the second half of the year. Talking about queuing, our transactional revenue for LoQueue was definitely impacted. Really, there were two things that were coming into play there that are less about the attendance volume at current customers, like the big ones that we serve.
But we actually had a customer in one of our locations that was offering virtual queuing to all of their guests, sort of post-pandemic, and they ran it for a couple of years that way, decide to continue with it only as a premium service. And so we were getting paid for every visitor going in the venue. Now we're getting paid on the premium side. So there was a shift in how they chose to operate the system. You know, again, it was a bit of a, I guess you could say, hangover from the pandemic decision, and they wanted to ease out of that. We also had a waterpark customer that shifted away from our product. You know, the waterparks are good for us.
Waterparks are not our best queuing business, but we did have a you know revenue impact from those two pieces. When you look at the lower attendance, we actually are seeing the revenue relatively holding up where attendance is down. The higher-end customers seem to still be spending. It's the middle customer where there's probably some weakness, but we're seeing strength on the queuing side. It's just been offset at some degree by these customers that changed or left the service. We've launched a pilot of QueueView at two venues in the U.S. That's our you know Queue management system, which uses cameras and AI and machine learning to predict the wait time. So we have a customer testing that at two of their theme parks.
We also implemented LoQueue within the Philadelphia Museum of Art. Within a museum, sometimes you have exhibits, whatever it may be, you know, that are high profile and very appealing. They had a challenge with the queues for that particular experience within the museum, and so they asked us to help them solve that with the implementation of LoQueue. I think it's just an example that there are opportunities for LoQueue outside of the theme park. You know, I would say maybe they're few and far between, but this is an example within the industry of the cultural side, where we can, you know, we can show we can add value there just as much as we can with roller coasters. Shifting to restaurant and retail, the third part of our business, which we just launched, Accesso Freedom.
I continue to hear our customer feedback be very, very positive. We signed eight customers for the new venue, and we've installed five of those that are now live at the period end. I think a couple more since the period end and have gone live. The customers that are seeing the demos are positive, and the customers that have it installed and running are very positive, and they're very, very highly referenceable, which has been an important priority for us. We're still working on some pieces. For example, we made the connection to Accesso Siriusware , so that guests with season passes or stored value cards that are within Siriusware, those can be validated on the Freedom side.
If someone's buying, you know, a hot chocolate at a ski resort or a hamburger at a waterpark, and they're using Siriusware, they can validate that entitlement or that pass discount or use their gift card in Accesso Freedom to redeem that. We're also seeing a range of prospects in Canada, specifically in Quebec, but Quebec has a unique requirement there that you have to have government certification for a system to operate there, sort of tax-related, and that application is in; we're just waiting for that to be approved. We've done the work required. We've submitted that, and we're just now waiting for a check mark on that. We believe we have a range of customers in that region that will be ready to sign up once we have that certification.
So you know, whenever I look at the half year, it's sort of obviously frustrating to me to not have been, you know, giving an upside update a few weeks ago. But when I look at the overall business and step back and think, you know, let's just stay focused on what we're doing, our operational success is absolutely spot on. Our product roadmap and our product innovation is, in my view, absolutely spot on. Our acquisitions are playing out as we expected. And you know, we've just hit a bit of a road bump here with the timing on this implementation that at the end of the day, maybe we should have planned a bit differently for and hedged in our expectations.
But, you know, we live and learn, and everything seemed to be, you know, moving along as expected until we got into this sort of summer, midsummer period and realized that we probably needed to move that out. So, you know, fundamentally, across these product sectors, I don't see anything that is of concern. I see shifting trends. I see consumers maybe moving their behavior around. But if you really peel it back and look at our individual products and how we're doing, it's not reflective or indicative of the update we gave, 'cause that really was strongly about the shift in this project. And if you look at our product and our transactional revenue, I think it's actually holding up, quite well.
We would like a little bit more, of course, and to, you know, be beating expectations, but it certainly isn't, it certainly isn't going backwards, if that makes sense. The last thing I want to hit, obviously, is our people. I was just at one of our user conferences last week that we held in Arizona for our Siriusware and Paradox customer base. And as I saw the 125 or so venues that were represented there, I heard over and over again what a great team we have and how we just stand out heads above our competitors. They work with competitors, they consider competitors, and they come back to us and just highlight what a difference it is working with us.
That plays into a lot of the things we, you know, we highlight here on the right, which is, you know, just continuing to provide the resources where we need them, continuing to help our employees work as efficiently as possible, helping them with development programs like Emerging Leaders and Women in Leadership. Our survey results for 2024 came in near the end of the period. Again, 95% participation, slightly ahead of last year, and we're once again in the 75th percentile of the benchmark companies. Our scores were essentially the same as last year, which were at an all-time high. We're very pleased with what our employees view.
Of course, in the details, there's a few things they don't like that we have to go work on, but broadly speaking, our employees are very, very pleased, and that then cascades into what our customers think. Our turnover at the half year is at 4%, so again, we're managing, you know, keeping very low turnover. I think the job market has cooled a bit in terms of, you know, people being recruited away from us. But also, I think, you know, as we've settled in with the acquisitions and the things we continue doing, our employees remain, you know, sort of convinced of our longer term success and the opportunities that lay ahead for them.
So I think people are sticking around with us, and you know, I think we're gonna continue to make them such an important part of our success because they're really behind everything we do, and I just can't say that enough. And you know, it's discouraging probably for some of them to see an update that says we have a trading update that's a little softer than we expected. But at the end of the day, everybody knows they're doing great work, and the things they're working on are actually going quite well. So I'm just very pleased with our overall team and you know, where we stand on that. So now I'm going to... I should have given my page numbers. I'm so sorry for that. I was on page 12.
I know some of you were following along on your own, so I do apologize if the screen isn't tracking with me. I'm now gonna turn it over to our newly appointed CFO, Matt Boyle, who's going to hit the highlights on the financial results, and then I'll wrap up, and we can take some time for questions.
Thank you, Steve. Starting on page 14, we've got our key financial highlights, which is putting out the pieces in our update this morning. Revenue was $69.2 million, which is 5.2% ahead of the prior year. Excluding that impact of the seasonal staffing that Steve mentioned, it's 9.9% ahead. That is we recharged cost that was on our books directly to a major customer for supporting the operation. If you switch your attention to the right-hand side, you see the revenue split on the screen. And you can see, as with the prior period, transactional revenue makes up the bulk of our mix, 76% last year, 74% this year.
That slight dilution is where we've acquired particularly Accesso Horizon, which is a repeatable revenue, so the blue bar, which is a license and support model, maintenance rather than the transactional piece for the time being. Again, so gross margin improved to 76.2% from 73.5% in the prior period. That is again directly related to that seasonal staffing impact. We no longer have those staff costs on our books, nor the revenue, so we are trending to a higher gross margin, which is more reflective of the business that we're actually doing, providing software.
Again, so Cash EBITDA of $6.5 million is behind our expectations, and that's largely because of the Accesso Horizon implementation in the Middle East that Steve mentioned. It was, you know, the project plan was H1 of 2024 for a large chunk of that revenue at very high margins, which dropped straight through to Cash EBITDA, which we're missing. And but pleasingly, our balance sheet is still and as it was at the end of last year, and has been for a number of months and years now, it's still strong. We ended the period on $18.3 million of net cash, which we'll go into on the cash flow statement shortly. So switching to page 15.
There's a bit more of a breakdown of our revenue by type here, which follows on from the previous diagrams. Looking at this, you can see our transactional revenue on its own was 2.3% ahead of last year. In there, you've got two offsetting things. One is the impact of ticketing and e-commerce being up 12.7%, which is largely the impact of Ingresso having a really strong H1 2024, which as Steve mentioned, was the result of work done at the end of 2023. Signing a particularly large new distributor, as well as changes in existing contracts that really allowed the business to kick on for the first half of this year.
And then offsetting that, we've got virtual queuing revenue, which is down 7.2%, which is through customers changing their service levels. While the volume still is there, it's just a slight change in service levels required. And then moving on to repeatable revenue, that's up by 5.5%. Repeatable revenue includes maintenance and support, platform fees and licenses, the bulk of it being maintenance and support. And again, Accesso Horizon, the business that we purchased, is a license and support business. So those revenues weren't in H1 2023, whereas we've got a full period of them in H1 2024, which is making up that increase there.
The non-repeatable revenues dropped to 13.1%, so our professional services business fluctuates year- on year, period on period. It's largely driven by customer demand, which is cyclical, and their particular projects that they have in play at any one point in time. So it's down 15.1% for the period-on-period comparison. Next slide. So page 16, we've got the income statement there. So we've talked about the gross margin being up 76.2%. Again, impact of the virtual queuing on there. The key thing to point out here, I think, is the mitigation we've done on our cost base.
So underlying cost base, so comparing without the acquisitions and just underlying cost mix proportion, so salaries, software, server costs, things like that. They're up 4.3%, and we have managed that throughout this year just to make sure that is in lockstep with our revenue movements that we have with maintaining margin. You can see the headcount piece there is the key component of it. So that was 692 at the end of December 2023, and we're at 680 at the end of June 2024. The other piece on there is the finance expense, so it's slightly up on the prior year. Again, that is the impact of the acquisitions.
We drew down $ 35 million to fund those acquisitions in June and end of May, June 2023. We've got a full period of interest cost on that while we have repaid it significantly, so we're down at $ 19.75 million drawn at the moment, which you'll see on the cash flow statement. The next slide, page 17. Again, this is a reconciliation of cash EBITDA just to show you how we get there. We are at $ 6.482 versus $ 6.481, so very close in the prior period. That's driven largely by an increase in operating costs this year, offset by increases elsewhere.
So we had in a prior period, we had $2.5 million of exceptional costs related to those acquisitions that we don't have in the current period. So you can see that movement in operating profit there, and also in the acquisition-related expenses almost offsetting each other. The acquisition-related intangibles increased significantly to $1.9 million. That is the intellectual property and customer relationships that we acquired, slowly being amortized through the P&L in the current period. There's a bit of an increase to $2.2 million in the share-based payments, which is reflective of new awards that we made post-acquisitions to support retention. And then you've got a decrease, a fairly substantial decrease there, of 49% in amortization and depreciation. That is largely the capitalization of R&D spend.
And those of you that have been following us since 2019, 2020, you'll know there was quite a drop-off in capitalization, which was more reflective of an appropriate R&D policy that was being pursued at that time, and the run-off of that. And then the next slide, page 18, please, is our cash flow statement. So you can see the increase in cash flow generated from operations before working capital, so $7.7 million this year. We've got movements in working capital of $14 million outflow. Again, that is largely seasonal. We generate our most of our cash in H2, July, August, September, October, as we collect the cash from those key peak seasonal months on the transactional volume.
Following the cash flow statement down, we've got a repurchase of shares. We started a repurchase of shares at the back end of 2023 and finished that in late February 2024, which resulted in a $ 2.8 million spend in this period. We have since restarted that program, so there's a GBP 4 million commitment of roughly $5 million. That will be spent hopefully over the rest of the course of this year. You'll see that in H2 2024. We ended the period on $ 37.2 million cash and as I mentioned earlier, the borrowings are $ 19.75 million, so we continue to maintain a strong balance sheet. That's it on the key financial pieces.
Pass back to Steve for the outlook.
And Matt, I was very glad you found the extra $1 on Cash EBITDA. From $6,481 to $6,482.
Every dollar counts.
Thank you. Yeah, every dollar counts, exactly. Well, just shifting to wrapping up on the outlook on page 20. On the right, you'll see Stephanie, who's one of our sales engineers, looking very optimistically into the future. She was at a recent event we had, so we took the opportunity to grab a picture. But our outlook for the year, as we stated in the trading update, is $150-153 million in revenue. That is largely impacted by the timeline shift for that project that we have mentioned over and over again. As well as, you know, we did see softness in the trading volume versus our expectations starting to emerge at the sort of very, very end of the period.
But then when we saw July and going into August, you know, we were just a little softer than we expected relative to our original, our original budget expectations. So that led us to a trading update when you combine that with the, the impact of the key project. And by losing that high-margin revenue, which essentially, you know, flows right, flows right to the bottom line, that'll put our Cash EBITDA margin in the 13%-14% range. So, you know, we've... I think you all knew that already. I'm just kind of stating the obvious here, but overall, this is kind of where we are. And, you know, again, I'm, I'm as optimistic as ever.
I know some will say I'm too optimistic, but, you know, at the end of the day, when you really look at, through our detailed statement and our numbers, I think you'll see the foundation here is, is in very good shape, and our product portfolio is probably in some of the best shape it's ever been in. So with that, I will, I will wrap up, and, just we can spend the next 20 minutes or so on questions, assuming you all have plenty for us.
Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you'd like to withdraw your question, please press star followed by two. When prepared to ask your question, please ensure your device is unused locally, and alternatively, you can submit your written questions via the webcast page. We'll take our first question from the webcast. It is from Tintin at Deutsche Numis.
One, in terms of the acquisitions, have there been any further learnings in terms of go-to-markets, their products, what needs more focus/refinements, et cetera? Two, with Horizon, what can you do to de-risk some of the milestone-based revenues it generates? Three, if there's time, ShoWare opportunities in the UK, what has triggered the opportunity?
Okay, certainly. So first of all, on the acquisitions, you know, anytime you acquire something, you lift up the hood, and you really get to know the product. You know, I wouldn't say you're finding problems, but you get to know the product intimately in terms of how it's set up, how it's operating. You know, you get to go a level of detail beyond, you know, what you do before the acquisition. I think overall, we're very pleased. You know, in Paradox, I think what we see is what we knew we were getting. We are probably more pleased with the reception from the market because our Accesso Siriusware product, which is an on-prem installation, you know, it's been around for twenty-five, thirty years. It's an on-prem, it's not SaaS.
And so customers are really looking to say: What are you gonna do here? We're looking for a SaaS product on our next, you know, our next round, and what do you have for us? And having, you know, having acquired Paradox and showing them that we, as Accesso, who they really like working with, have a plan for them, and I shared that with them at the conference last week in more detail, and they're just very, very positive about what we're doing with Paradox and, you know, the plans we have for bringing that to the market as a SaaS solution. We have some work to do for the U.S. because this was a Canadian based application. So there's some things like, you know, U.S. taxes can be a little different, the payments are different.
So there's a range of requirements we're working through to make it what we would call U.S. ready. And there are also some features that were in Siriusware that were not yet in Paradox, and the customers probably view them as essential. If you're going to move from Siriusware to Paradox, they want to have those features. So, you know, some just adding some adjustments to how they handle ski rentals, how they handle lessons, and things like that, which we're working through, and, you know, we roll them out on every release. And, you know, overall, I think on that side, we're in great shape. I think Horizon, you know, what we realized is the demand is as robust as it seems. It's about prioritizing the work we take in there.
That team is small, and we're working on scaling it as quickly as we can. But, you know, taking a company with 36 or so employees, you can't just drop 20 more on top of them. You have to let them absorb and train those people, so we're slowly, you know, adding staff where we can, and we're also beginning to leverage accesso resources to help them much more broadly on a range of projects. So that, I think, is gonna help them move along a bit faster than they would have on their own. And, you know, we've just gone another phase of the implementation in Osaka. We've just gone live with the large project in Singapore. We've been awarded a venue here in the U.S., that's part of a larger customer's regional expansion plans.
There's a lot of things happening in Horizon that I think are very, very positive. You know, we've taken some time to assess the tech, and we're working on building out the roadmap for, you know, what do you add when, what do you refactor when, and what does that look like over time? You know, for me, Horizon was always a mid to long-term acquisition. It was strategically very valuable for us from a competitive perspective to bring that into the accesso portfolio. It's a successful business. It operates with a, you know, nice level of profitability, and we'll continue to grow that, you know, across the enterprise customers, you know, as the opportunities arise, and there are plenty of them.
So, you know, that's really, you know, the Horizon, by definition, is going to be a milestone-based product until we start refactoring some of those components. Partially because the pipeline already has customers signed, that are signed on a milestone basis. And so we can't just change the rules on those customers, like the ones in Saudi. We have to kind of live our way through that. As we go forward, I will be looking at breaking those milestones into smaller pieces, you know, sub-deliverables within the milestone, so it's maybe not quite such a large amount at one time. If you have a hundred things to do and that, that's your milestone, you've got to complete all one hundred. I would rather see us do, you know, thirty-three, thirty-three, thirty-three, and get paid as we go.
So we'll look at how we can adjust some of those commercial terms, as we move forward, and we'll continue to look at opportunities to bring in more transactional type revenue into that product as, you know, as we can. So that is definitely, you know, something we're working our way through. It's a very big and complex solution, and so, you know, you've got to move through at that level of speed, respecting the, you know, the complexity of the product. And for ShoWare in the UK, I think there are sort of two buckets of opportunity.
The first one that I think is the most apparent is there are a lot of, I guess you would say, smaller football clubs, small to medium football clubs, that use different solutions, and I think the view of those customers would be, there's an opportunity for something better, and so that's an area that we're really focusing on in terms of bringing the awareness out. We're going to their trade shows, their events, showing them the products, you know, letting them become aware of the solution as they go into their renewal cycles and their tech roadmap, that we're here and we're available as an option, and then also, you know, there's a range of other sort of festivals and other type events.
There are surprisingly a lot of them in the UK as we dug into it, and so we're looking at those kinds of opportunities where, you know, we can get a foothold in the market. It's all English. We had to do a couple of things to make it UK ready, like, you know, make sure we could handle VAT appropriately, a little bit of, you know, British English compatibility, if you will, so some relatively small adjustments to bring it to the UK, and so it gives us a new market for our, you know, our sales team, and I think it's gonna, you know, take a bit of time to build, but having a product that we could sell there and not selling it was a missed opportunity.
So taking that wall down and allowing that to be available in the region, I think was a really important, you know, really important step for us.
Our next text question is from Katie Cousins with Shore Capital.
One, could you give some further color about some of the expected volume drivers you expect from your clients during H2 and next year? Two, could you provide an indication of how the CapEx spend and dividends between your main product lines and how you see this developing? For example, does the e-commerce development in Passport indicate a step up?
Okay, yeah, a good question. So the volume drivers, I think you see on the regional attractions is, which is where the majority of our transactional revenue obviously comes from, large day pass Passport and to some degree, within ShoWare and [Siriusware] as well. You know, the regional attractions have a lot of. When they change something, they can affect the market very quickly. So if they do a promotion, if they, you know, offer season passes earlier than last year, if they expand the benefits, you almost get a snap response because those people are within, you know, a stone's throw of the venues. When a destination attraction does that, it could take them several months for that consumer marketing to have effect, and even a year before those customers show up, depending upon the planning cycle.
So where our regional players will be looking is, you know, looking at their daily ticket pricing. They're not wanting to go backwards, but, you know, how can you be creative with what you offer, in terms of bundling and packaging of the daily tickets? How can you, you know, think about your season pass program, how much marketing spend you put behind it relative to years where maybe it sold itself more? So they'll be looking at those different factors and building their own sort of formula for how they operate in a, you know, in a substitute effect economy versus one that's a bit different. And so, I think when you look at the combined Six Flags entity, I think they're very astute at doing this.
Just like we saw on the Cedar Fair side of the business, you know, they were tracking quite well in their business. I think we'll see that kind of begin to roll across the entire new Six Flags portfolio. I think you'll see the other operators doing the exact same thing. The destination locations have a bit harder time, so what they'll do is they'll try to pull locals in more. They'll play that card. So if you're in Orlando at the theme park, they'll try to get Florida residents to come visit you more often. They're a much easier, you know, to get the take rate from them. So they all have playbooks for this. They've been here. You know, they've been to this rodeo before, as we would say.
And so they will definitely be working their way through those, and we're already starting to see those come into play. You know, I can't share more about H2, but I'm starting to see the customers really thinking a lot about, you know, where they are and how they adjust those parameters in their marketing and in their product offerings. And, you know, also, I think... I will add this: I think one of the factors you might be seeing in Orlando, too, is maybe not to be mistaken by it being all consumer economically driven, if I can use that phrase. You know, there's a range of new capital coming in the Orlando market. You know, Disney has a range of new products.
Universal has a new theme park opening. You know, I think SeaWorld has a significant new, a new offering coming. So consumers can sometimes look and say, "Oh, wait, this year is kind of a normal year, but next year they have all this new stuff coming. Maybe we should wait and go to Orlando, or wherever it is, the following year to get the most for our money."
So you can start to see a little deferral when there's a lot of new and exciting things, whether it's a big anniversary at Disney, where they're celebrating with all kinds of new entertainment, whether it's a new park coming or a big new ride coming, people will shift their behavior a bit. And I'm not convinced that all the Orlando results that are being reported by all three companies are related specifically to the economy.
There may be a factor coming in around the planning cycle and how customers are responding, so I think we'll see each one of these companies do their own thing that's relative to their market, and to me, you know, I think we'll see much more balanced results as we go into 2024 as a result of that. In terms of CapEx, you know, things like the e-commerce product, you know. Yes, obviously, it's important to bring in new customers and to show them that, but it's also really important that our customers are happy with the product they're getting, and they continue to renew, whether they're an enterprise customer or otherwise. Passport is, you know, essentially a third of our revenue, and so making sure we're maintaining our foothold there is really important to us.
And so keeping our product set fresh there from a capital investment, it is probably our largest from a total revenue, our largest growth opportunity, at least in the near term. And so, you know, being in the market and showing the demos of that product, meeting with your customers and having that product be, you know, just five stars across each module, is really, I think, an important factor of our retention strategy, and it's an important factor in our go-to-market strategy. So, you know, we see some of those play out in the short term. We also see some of them, you know, when you look at our net revenue retention, which Matt can probably throw that number in here.
With our net revenue retention, this is part of how we maintain our business as much as we do grow it. I think it plays on both sides of the fence. Matt, we've just taken a look at our net revenue retention. Can you give a highlight of what that number looks like right now from a full year basis of 2023?
Not right now, but I can follow on from Katie's question, which was the CapEx piece, which I think she was talking about how much actual cost will be capitalized to the balance sheet in future periods as a result of these new initiatives.
Okay.
The important context there, I think, to give is the Accesso Freedom has occupied a lot of that cost for the last 18 months, 24 months, really. And it's starting to tail off in terms of how much we're capitalizing because the product has been since launched. That number is now being replaced by these enhancements that we're talking about on Paradox and on Passport for enhancing their e-commerce solutions. So while the spend is... It will probably stay at slightly the same, at the same sort of levels it is now, proportionally. It's just got different components to it. It will increase as we get through the rest of this year and into next year, particularly as we develop these enhanced e-commerce functionalities that we're mentioning.
Because the enhancements we're making are also going into live customers in many cases, right, that affects our capitalization, because they're not always a new product that is being launched, like Accesso Freedom. So there's always a balance there, and thanks, Matt, for clarifying that. You know, I guess from my view, we're working on Cash EBITDA, so you know, how we move that between the two is a bit of an accounting treatment. At the end of the day, it's still expense for us, but I totally understand your question.
Our next question comes from Richard Jeans with Hardman.
How are you expecting Ingresso revenues to develop? When are you expecting to reach 80% gross margins?
We, I would say that's probably a little more detail on an individual sector than we typically, you know, disclose. I can tell you from a business plan perspective, we have a very clear priority because that product line, that solution, is a drag on our margin, to be frank. And so, we have made or making a very pointed effort to reduce the drag, if that makes sense. And so things like revisiting commercials on customers, I think that product has more value than perhaps was inherent in some of the pricing models.
So, you know, we are literally going through there, and if the customer isn't willing to compensate us for the value provided, we're actually letting them walk because there's no reason to have the revenue if it doesn't have the appropriate profit. A lot of these are very, very small clients that are in that mix. There's hundreds of customers. So the larger customers, I think actually we've had a chance to refactor some of the commercials. We have new items coming in that are at a much, you know, better sort of, I guess, business model, like the work we're doing with Major League Baseball. You know, you have venues in there like ABBA. I mean, it's very high volumes on products like that.
It's really just about, you know, fine-tuning our approach. I will say, you know, things were shut down in 2020. 2021 was pretty quiet. You know, we've now gotten the, you know, the legs back under that business. It's really time to fine-tune what's coming in, things like moving from the box office away. So now what we're doing is going through each one of those individual revenue items and looking at the margin and deciding what to do with it. Because at the end of the day, I would rather have less revenue with a respectable margin than have a bunch of revenue coming through that isn't highly productive.
So, you know, we wanna meet the customer's needs, but we also don't want to be diluting our overall profitability by donating our services, you know, where applicable. So, you know, overall, I think that would be, you know, it's gonna take a couple of years to get there, but when we get to the end of the year, because we have a lot of revenue come at the end of the year in that business, we'll be able to provide more of a perspective on maybe I think where, you know, where the gross margin ended up and kind of what we're thinking about it going forward.
But, you know, in the past, I would say this has been kind of operating at normal year on year, and the last quarter of last year, we really shook things up and, you know, I said, put a new senior leader in charge. They've had a chance to refactor a lot of the operational processes, the commercials. I think we're gonna see that continue to step up as we go through, you know, these earning cycles.
As a reminder, if you'd like to ask a question, please press star one on your telephone keypad now, or alternatively, you can submit your written questions via the webcast page. We'll pause for just a moment.
Yeah, I think we have time for one more question. If anybody has another one for us? You guys are letting me off the hook easily today.
We have no further questions. I'll hand back to you, Steve, for any final remarks.
Certainly will, and thank you very much, and thank you all for taking the time again. Hopefully, you know, going through this and reading this full statement provides a bit more context around, you know, the individual layers of our business. It is a bit complicated with all the different products and all the different variables that you have to consider. But you know, my takeaway from this is I'm hoping you'll walk away feeling a bit more confident in terms of what our underlying numbers really, you know, look like and the dynamics around this, you know, project moving around that has affected us this year, which is certainly not a reflection, I don't believe, of our underlying business model or, you know, the continued value proposition that we bring to the market.
So with that, I would say thank you all very much. Again, welcoming Matt to our role as CFO. And, you know, I look forward to speaking to many of you individually, in the coming days. And of course, if you have any questions, you know, feel free to reach out to us, and we'll be happy to help you out. Thank you all very much.
Thank you. Ladies and gentlemen, today's call is now concluded. We'd like to thank you for your participation. You may now disconnect your lines.