Earnings Call: H1 2021

Apr 18, 2021

Good afternoon, ladies and gentlemen, and welcome to the Ascensus Half Year Results Investor Presentation. Throughout this presentation, investors will be in listen only mode. Questions are encouraged and could 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 and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company review all questions submitted today and publish responses where it is appropriate to do so. These will be available via your Investor Me Company dashboard and we will send you an email to notify you when they're ready for your review. I'd also like to remind you that this presentation is being recorded. Before we begin, we would like to submit the following poll and would be grateful if you could give that your attention. And I'd now like to hand over to Mark Furniss, CEO and Alan Pepper, CFO from Ascensus. Good afternoon to you both. Thanks, Mark. Hello and good afternoon, everyone, and welcome to this half year results presentation for Ascensus for the year end 31st January 2021. My name is Mark Furness, CEO and Founder of Ascensus, and alongside me today, we have Alan Pepper, Chief Financial Officer and Chief Operator. So just briefly, I'd like to recap our business for those of you who don't know us. Since 2006, Ascensus Technology and Software has really been at the heart of the flexible workspace revolution. We are the technology making flexible workspaces work. And by most measures we are today, the leading global provider of mission critical software platforms and on demand cloud services to that very flexible workspace sector. It is a sector which is undergoing massive and considerable change, particularly in light of the COVID pandemic. But our platforms for the last 15 years have been designed to help our customers increase operational efficiency, engage with their customers more actively, provide services on demand, deliver in building experiences that meet the requirements of occupiers, and actually help those providers of flexible workspace to make better, faster decisions. To cover the highlights of H1, FY21, it's been a year really where we've seen the headwinds of COVID really start to give way very recently to the structural tailwinds that are strengthening and actually that are growing in light of the changes to the way real estate is used, where office space is consumed, and the way people think about how they work as we go forward. It's been a year that we've proved again our resilient performance and this year again we deliver performance in line with market expectations. It's been a year and a period where we've increased investment in the U. S. Opportunity. That's led to significant and strong and continued U. S. Growth. We've got a well developed opportunity pipeline, and it's clear now that the future of real estate is one which is flex. It's an opportunity which is accelerating in front of us, and whilst lockdowns have undoubtedly delayed the recovery of our sector, and perhaps even our own recovery through the period, it is clear that the future is very exciting and very bright for technology providers and the flexible workspace sector at large. This year and in the period we report recurring revenue down 1%, slightly up actually on a constant currency basis. Group revenue is down 7% on the period, and that's really a reflection of reduced occupancy in the spaces of our customers, and that means our marketplace revenues have been reduced this year. We also have seen a reduction in the number of new site go live. So our non recurring revenues in the period have reduced accordingly. Today, we still have 91% of our revenues are recurring, gives us great foundations and a really strong business. And following our continued investments into the US and go to markets and also into product, we report EBITDA margin of 7%, which is in line with our expectations. While business is straightforward, our strategy is also very straightforward. Our model is to land, expand and grow with our customers and this year and particularly in the last 6 months, our primary focus has been the opportunity to land new logos. It's clear that Ascensus is in a land grab environment. It is the changing face of real estate that means we have an opportunity to go and find new customers that will provide significant long term growth opportunity for our business. And again, we've executed this strategy really well in the period, we've acquired 18 new customers and now we're working with some of the very largest major global real estate brands and landlords and flex workspace providers. And that provides us with significant opportunity for expansion with those customers over the coming months, years and even decades. And so our focus to land new opportunities has been tempered somewhat by a delayed recovery through COVID. But recovery will drive an increased occupancy in these spaces, which means our marketplace revenues will recover accordingly. We'll also see new sites being delivered as the lockdown eases and we are able to now deliver new sites due to customer expansion, customer growth, new Mail Dog and the new opportunities that flexible working is providing us. Also, our growth opportunity is significant. The opportunity is accelerating massively, and it's accelerating massively to the point that actually we know the opportunity needs investments. We've invested in a North American CEO to drive our expansion across the U. S. And Canada. We've developed our go to market strategy and started to execute that in Europe. We have a well developed plan, and whilst we are delayed in executing, we still have a developed plan for APAC. And our new product, our Flex Services platform, which I'll talk about more later, we think will be an absolute game changer for the flexible workspace industry and the wider real estate at large as we look out to the future. So let's just talk a little about that recovery. And this year, you can see our platforms allow us amazing granularity and visibility of what's happening in real time in our customers' spaces in these buildings. And you can see with the graph on the bottom left, you can see the real time occupancy impacted by lockdown 1, immediate reduction to pretty much 0 in occupancy in all these spaces. And that period, we start to see a recovery over time as we move to around October and that was the last time we presented to our investor audience. And at that time, we noticed green shoots, we thought actually that the route out of lockdown and the route out of the pandemic was just in front of us. And then lockdown 2 and subsequently lockdown 3 hit and you can see the impact to occupancy or our customer spaces that happened there. And so the lockdown, whilst having significant impact, you can see that we're on that way out and actually since the 1st February, we've seen a 34% increase in UK site occupancy and 11% increase in US site occupancy. And the US now of customer sites are broadly around 50% occupied at the moment. That's also supported by our very low site chain, we continue to have industry leading chain levels, so very low chain in our customer base. And that supports, gives us a great platform for which to compound our growth over time. And so this year, H1, we've seen occupancy impact in our marketplace revenues and we've seen those moderate. We've seen that site activation numbers reduce, extending sales cycles, we've seen reduced sales bookings and we've increased our customer support. But that's now giving way and those, if you like, headwinds are giving way to those tailwinds and the accelerated outlook. So occupancy is returning as we talk to. Activity in our customer base and with prospects and with the wider real estate industry is building rapidly. And that means our customers are moving back into a hold phase, back to a growth phase. We see accelerating bookings, more of which later, and we've got a really strong and well developed pipeline. Now at this point, I'd like to hand over to Alan who will take us through the rooms. Thanks Mark. Good afternoon everyone and thanks for joining. Probably just touch on and just reiterate Mark's point of a moment ago, where in terms of the year we've had and certainly this last 12 months has undoubtedly been the most challenging year the business has been, but I'm sure it has been for everyone. So when we sat here last October, we were anticipating seeing some improvements in the first half of this financial year, which clearly hasn't come through. But nevertheless, we are very pleased to have met our expectations for the first half as we come out and report these financials. So revenue at 10,600,000, as Mark mentioned a month ago, down 7% overall. But in reality, the vast bulk of that is driven by the reduction in the number of new Connect sites that went live in the period compared to the first half of twenty twenty, which was our first full half year post IPO and was obviously the period immediately prior to COVID. The U. S. Recurring revenue was up nearly a quarter in U. S. Dollar terms, which is very positive. We'll talk to the U. S. A bit more in a moment. U. K. Recurring revenue down as reported this morning in the note, if you've read it. And that's primarily marketplace where we've as Mark talked to a moment ago and offset in some elements by increases in software revenues in the UK. Our ARR run rate at a constant currency, slightly up at 19,900,000 for the half year, up from 19,700,000 last half year. And you can see there on the slide the individual product elements of revenue. So 9,600,000 for Connect, that's where most of the vast, vast bulk of the non recurring revenue sits, which is what's driven that. And operate our ERP platform, up 11% in terms of revenue. And I'll touch on the dynamics there in a moment. EBITDA for the half year, £700,000,000 down from last year, and I'll touch on the particularly overhead movement driving that in a moment. Recurring revenue up 6 percentage points, primarily as a consequence of the reduced non recurring revenue, obviously with the U. S. Recurring revenue up as well. But net retention was 94% in the year. And so that's the revenue that we had from the customers that existed in January 2020, revenue we got from January 2021. And that movement, again, same with the sort of recurring revenue driven primarily by marketplace movements, downwards. Gross margin, however, was up 4 percentage points in the year compared to the prior period. And there's a couple of drivers to that. Firstly, obviously, the reduction in nonrecurring revenue as an absolute proportion. That's lower margin, and so that, therefore, enhances the overall gross margin. But probably more importantly and more of note really is the increase in the gross margin from our U. S. Business, which was up 6 percentage points from this time last year. U. S. Business much less mature than the UK, got a higher direct cost base due to scale and the way our sort of supply dynamics for our part of our Connect product are. But very pleased to see that margin improvement coming through and we would expect to see that continue throughout the balance of this year and into next year. Alongside that, UK margins in line with where they were last year at 70% for recurring revenue gross margin. So notwithstanding reduction in marketplace revenue, we've seen cost efficiencies and some improvements in software revenues, which are higher margin, maintain that overall margin for the year. So those are the financial highlights for the year. If I look to the products, Operate, our ERP platform, now 10% of the revenue was up from about 8% last year. Revenue up 11%, and that's driven primarily by an increase in numbers of sites in recent months and also primarily by revenue per site. This was a part of the business which had had significant it managed churn where we had inherited a number of customers who were paying relatively low amounts of money for quite substantially capable software. And it's taken it took through probably to the second half of last year before that had worked its way out. So this is the first half of comparison. And that's what drove the reduction in customers and sites in that number and also net retention number. But notwithstanding all those things, revenue up as we've continued to bring in higher value customers who are paying more money for the product. On the Connect side, fast bulk of the business. So customers up slightly, numbers of sites up 8% net and net retention at 95%, similar to the overall group number given this proportion of revenue and that number down from last year, but again, driven by marketplace revenue, which we anticipate recovering in time as underlying customer site occupancy comes back. And margins overall are in line with last year as we balance out UK margins and the U. S. Increase. So that's how the products work. And in terms of the financial statements themselves, clearly, there's more detail available on the website. I'm not really I've covered off the revenue and the margin elements. In terms of the overhead movement, which is a big, big element around EBITDA, the business is going through a phase of go to market, in particular investment in go to market capability. So as Mark mentioned a while ago, new Chief Executive in North America. We've employed some additional sales capability in North America, in the UK and in Europe as we expand our geographical capability and start to deal with higher profile, more intense, if you like, more professional landlords and corporate real estate. So that's the prime driver about the Hove Antipat together with increased marketing spend. And so I said that's probably all immediate on the P and L. In terms of cash flow, we slightly cash out from working capital in the half year. That's driven by reduced creditors. It's a timing issue. There's a big structural in that. It's just a timing issue as we can see in January. We continue to invest a couple of million to CHF 2,400,000 is our sort of expectation in software development. And we'd expect to continue to do that on an ongoing basis. And that's £500,000 of equipment investment, which is as we extend our SensitiveSky data center network capability and capacity both here and in the U. S. And in due course in Europe. That's what matters. We obviously raised £7,000,000 last April at the start of the pandemic, and that made a big difference there obviously to the opening cash position. And we ended up the half year in line with where we expected to be in terms of cash at about 6,000,000 pounds So well funded for our expected comments going forward. There's nothing of particular note on the balance sheet. And then on our key performance indicators, a few things to highlight. So the in the middle of the screen, the LTV, there's a lifetime value to customer acquisition cost, is a measure of our efficiency at sales. And we where the benchmark, I guess, is 3 or if you're below than 3, that would be not great. We're clearly we are much very efficient in terms of our sales activity. That number was slightly higher. It was about 5.9 at the year end, but we continue to invest and grow our go to market capability and spend, and therefore, that's come down a bit. We'd expect it to come down a little bit more over the balance of the year and then start to recover into 2022. But still very efficient in terms of the amount of payback we get from our spend on sales and marketing. Customer concentration position remains static really, which should be no surprise given that the market and customer base. So with that but we'd expect that to start to come down more in a more accelerated manner going forward given the customers that we've taken on board, some of whom Mark will talk to in a moment. And again, we increasingly cross sell products, both operate and connect into our customer base. And that's particularly true of the newer, more traditional landlord or corporate real estate operator customers who for whom we provide the complete technology platform for operating a space when they move into this sector. And finally, for me, the key performance or key indicator from a value and content perspective is ConnectSites. We ended up the half year at 431, as mentioned a moment ago, up from last year and up from year end. We have 51 contracted sites for delivery at the moment. That happens to be up from when we reported our pre close statement a month or so ago, which I think was 38 then. So we're up about another 13 or so. And it is the same number actually as we reported this time last year by coincidence and not design. So well placed there for delivery of contracted sites over the next few months, and we don't expect that number to continue to move up over the next weeks months. Mark, that's for me. So back to you. Thanks, Alan. And so let's talk now specifically about the market opportunity. And this is a structural growth story, and we think the hero could be digital transformation. And so everywhere you look, unless you've been living under a rock, this past year, commentary, publicity, the media, and pretty much everyone has been talking about the future of work, hybrid working, the death of the office, and how we will adapt in a post COVID world, and how we will go about our business. And actually these meta trends, we've seen developing over the last 15 years as a service model. Tech enabled services, the cloud economy, and the move to more agile solutions. All of these things we've seen gather pace in real estate in recent years. And actually now, you've seen the very biggest real estate companies, the very biggest landlords and asset owners becoming very, very active in the flex workspace sector. And none more so than the world's biggest commercial real estate company, CBRE, who only a few weeks ago announced their significant investments into our biggest US customer, Industrious. And the reason they invested was because they have a huge global occupier base. And according to their CEO, Bob Sulentek, he says that more than 80% of those global occupiers want to be in multi tenant spaces with flex components, And they need to respond to that demand from their occupiers. And to do that, they decided that they could do that more quickly, leveraging the industrious platform, which is powered by Ascensus. And so that is a big moment for our industry. And actually, you can see the examples of that through many different landlords, asset owners, and real estate companies globally. And I said, digital transformation is at the heart of this. And interestingly, digital transformation in commercial real estate hasn't really happened very much in the past few years. But it's clear now that actually the future, it will be critical to digitally enable these spaces and the experiences and the operations of these businesses in order to win. The US, quite clearly with according to Deloitte Research, the US is further ahead in terms of its digital transformation journey for real estate than the UK and Europe or even APAC. And actually, we've seen that in the conversations with our customers, with the engagements we have with the industry at large and you've also seen that pull through in the speed of growth in our numbers. What's also interesting is Deloitte Research in 2020 estimates that the cost of delivering and operating these spaces in a post COVID world will increase by nearly $20 per square foot. Now that's a considerable cost to bear, and so the real estate industry is now looking to technology to deliver efficiency savings to help them offset that cost. As well as that, they're looking at ways to reduce their vacancy rates. Globally, more than 60% now of all occupiers and all real estate companies anticipate an increase in vacancy rates over the coming year. And so the backdrop is 1 where costs are rising and vacancy rates are also increasing and the industry is looking to technology to help with that. And so it's that focus on driving compelling returns for the industry that brings us to today for a census. It's clear from research and from commentary from customers, occupiers, and the real estate industry at large, and Deloitte's research that digital transformation and the tenant experience is now a business imperative. This is critical to the success of workspace providers and landlords. And it's critical to the future and actually landlords are recognizing this with over 70% now, accepting and knowing that it's essential and even critical to have the right technology as part of their operation and part of their value proposition in order to be commercially successful. And it's also about delivering a compelling return on investment. We know now, in Ascensus, we've felt this for many years, but we actually know that significant ROI from our technology is delivered because actually tenants and occupiers of spaces that deliver great digital and technology experiences are prepared to pay at least 20% extra per square foot. And so actually, when we're looking at how we offset those additional costs and deal with vacancy rates, technology is at the heart of this. And we wanna make sure that we are delivering the right technology for the industry, not just now, but for the decades ahead. We are in a unique position as a census. In our 15 years in this industry, we solved for many problems. And so 3 years ago, we started to think about what the future would look like for these in building experiences. What would hires want? How would they want their journey to be? How efficient would we want them to be? Would we want masses of automation? And because of that, we started to look at how we could disrupt our own platforms. We worked with some of the world's leading commercial real estate companies, our big customers, and we took masses of inputs from big enterprise occupied as well as some research houses. And it was clear to us that at the heart of everything needed to be security, digital and physical security. So we needed to develop our platform and use our deep understanding of the security requirements of these spaces to deliver a protected experience. We also knew that at the heart of this needed to be integrated operations, so that actually could reduce time to value to 0 in these spaces and the operation would be very efficient. Yes, sorry, Mark. Sorry to cut across, just to experience a little bit of dip on the broadband and just to keep your audio in sync. If I could just ask you to turn your camera off and perhaps Mark as Alan as well, that would be great. The slides will expand for investors and I'll hand back to you. Thanks for your day. Cheers. Thanks, Mark. Sorry for that everyone. George, you're working from home. And so what we have is these pillars that are underpinning our platform strategy. And we knew that actually the space management, the operations, and the actual infrastructure, we needed to convey to them all to deliver an amazing occupier experience in this space. And to deliver true digital transformation, it needed to be the customer, I. E, the occupier experience that we put at the very heart of this. And so after 3 years nearly of developments and scoping and coding and significant investments. Last week we launched the Flex Services platform. We think this is a truly game changing platform for the future of not just the flex workspace industry or the wider real estate industry, we think this is an operating system for the future of the way offices are used and managed. The focus of that is as I said, it's to really lay on the digital infrastructure and the private infrastructure we built, to deliver amazing autonomous and automated operations management and an understanding, a deep understanding of what is going on in these spaces. So if you like, a digital twin of the environment, all allied and compares to this amazing occupier experience. We've had great feedback from our customers and from the industry already. IDC, one of the research house and one of the analysts have already said this is a powerful enabler for the next normal. And one of our major customers, industrious, has said they think Flex Service Platform will absolutely transform the way, not just our team, but also our members, their occupiers engage with our workspaces. So we're really excited for the future of our customers powered by the Flex Services Platform. But not only do we have to do this for these spaces and the occupiers in the Flex spaces, but we also realize that actually in these spaces, many of the existing tenants in traditional space want access to these experiences too. They want mobile fares availability to be able to book and use meeting rooms, open doors, get access to a wider network of space, and that's gonna be critical in the hybrid world. It's gonna be critical as well for the enterprise to be able to customize and control that experience with security policies and guardrails. And that experience in terms of the landlord and the provider of the space will be really valuable because it will connect them not just in the space they today lease, but also to the additional value in the rest of the real estate platform. And so we're really excited to extend that capability into the world of the traditional tenant too. Now as well as Flex Service platform today, it's clear that we are now in a world where we're needing to solve for new problems, and so we've recently launched Ascensus Labs. It's our internal Skunkworks R and D capability that looks at how we think about researching applications and new technologies such as machine learning or AI, big data and IoT, to solve for the problems specific to how to deliver flexibility in real estate. And we're looking to deliver hardware products that complement our software platform, and if you like, to innovate where we need to and where no other products or services exist. We wanna really converge this experience, and where necessary, we're quite happy to use our own hardware to disrupt the commercial and technology models that have existed to date, and are not fit for purpose for the new world of real estate. And so as well as investing heavily in product for the opportunity, we also continue to invest in go to market. Our new North American CEO, Jeremy Barnard, who was formerly Head of Real Estate for Knotel in the US, has made an amazing start and we think his focus in that market will give real returns in the months years ahead. We've evolved our brand to really talk to the needs and challenges of the commercial real estate market, and so now we are really focused about making sure landlords and the commercial real estate markets at large understands how we add value and how we are compelling. That will go to the Flex Service Platform launch, which we just talked about, which gives us that wider access into a much deeper market opportunity and much wider opportunity. And we are still focused on extending our geographic reach. We're currently recruiting for an APAC CEO to drive our go to market activities in APAC, which have been curtailed somewhat recently because of the lockdown restrictions that we all face. As well as the investments in go to markets, I just want to touch briefly on how the commercial real estate market has evolved over the last few years, but particularly in the post, if you like, as it looks in the post pandemic world. And an interesting stat is that now 90% of all occupiers believe that lease flexibility will increase in the future. But lease flexibility is not at the heart of what will win for landlords and real estate players. What will be at the heart of that is the experience in these spaces that they deliver. It's more than just saying, I'll give you a 6 month term instead of a 20 year lease. It's about the experience, it's about delivering real estate platforms and networks, and we think technology is at the heart of this. And so even colliers suggest that you really need to think about the investment in the customer experience because that will drive brand loyalty, it will drive value and it will drive an increased yield. And that is critical for obviously for us as we think about the market's opportunity. And just an example of where we are today, I wanna share a customer journey. Tishman Spire are one of the top 10 largest office landlords globally. They're most famous for, they own and operate Rockefeller Center in New York. And actually when they came to us after a big RFP process in 2018, they started with one location, one building 33,000 square feet of flex. 2 years later, this a multimillion dollar opportunity and a multimillion dollar account and they're given 20 locations in 9 markets with over 700,000 square feet on our platforms. But that is still small compared to their overall square footage. That is a 90,000,000 square feet business. And so we have still plenty of runway in that account to go for over the next years decades. Many of our other logos, our customers, people like JLL, Cushman and Wakefield, EQ Officer and you've just seen recently in Europe, also provide that level of opportunity for us. So we go in and we prove how compelling our technology is and we will grow over time as they look to deploy more flexible solutions in their portfolio. And that leads us to how we're seeing momentum build. And momentum has been building significantly recently, and that's a really strong foundation from where we stay today. So today we have 167 customers, and those 167 customers provide access to over 10,000,000,000 square feet of commercial real estate globally. And that means that we have massive opportunity with those logos alone to grow significantly in the years ahead. It is our job to make sure we continue to deliver the value from our platforms and from our technology that makes their businesses and their journey to Flex more successful. And even now, we're starting to see those customers prepared and very happy to talk about how we're impacting their business. Cushman and Whitefield, Tishman Speyer, Industrious, all now clearly referencing the value we bring, how we've evolved from digital infrastructure to the full life cycle. How we created a new digital experience, and how we're transforming the way these operations and how these buildings and spaces engage with their occupiers. And as we stand here today, or sit here today, we're reporting that sales bookings are now in the current quarter at the highest level since pre COVID, so real evidence of that recovery and momentum beginning to gain pace. And so where do we sit in terms of our outlook? So as Alan says, we are in line at the half year and we expect to be in line for the full year, but the outlook is much more than that, it's about the future of our business. And so this year, in which was a challenging period, we've strengthened the foundations, we've really, really focused on landing and working with those strategic high value opportunities that we know will provide us significant customer expansion opportunity in the future. That as well as those existing customers, there is an accelerating market opportunity and a backdrop when more and more landlords and commercial real estate companies are responding to their requirements and their demands for flexible product. And so that market opportunity will continue to provide us with new prospect opportunities and new logo opportunities as well. And we think that the Flex Services platform not only meets the requirements of this industry now, but it extends the product reach with its capability and its value much further up the building. It becomes at the very, it actually moves to the very heart of the building and actually becomes, if you like, a building operating system for the new way of working and for the flexible phase models of the future. And so as we are now, we definitely saw significant headwinds in the previous period, but we are now seeing them give way to very strong tailwinds that are driven by structural growth and a very significant change in the way real estate is delivered over time. And so, thank you very much. I'm now going to cover, some of the questions that have come in via Q and A. Mark, that's brilliant. Thank you very much. Let me just give you a small breather and a chance perhaps just to have a look at that Q and A. But ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated on the right hand corner of your screen. But just while Mark and Alan take a few moments to review those investor questions that have been submitted during the meeting, I'd like to remind you that recording of this presentation, along with a copy of the slides and the published Q and A can be accessed via your Investor Meet company dashboard, and we will notify you when they're ready for you to review. I'd also like to remind you that your feedback is important to the company. And immediately after the presentation has ended, you will be redirected for the opportunity to provide feedback in order that the company can better understand your views and expectations. Mark, obviously, Alan, if I could just ask you to have a look on the right hand side of the screen, you'll find the Q and A panel. Thank you for bringing up your cameras. I will perhaps butt in if it looks like broadband is causing us an issue, but for the time being, it all looks good. So if I could hand back to you, if I could ask you to read out the questions, and perhaps give a response where it's appropriate to do so, and then I'll take the floor back at the end. Thanks, Mark. Sometimes I look better pixelated. So, we have some questions from, firstly from Alastair L. And first question is, could you please comment on competitors? Is Team mainly working for WeWork or does it have a wider customer base? Team was, it's a visitor management and booking app that was developed in the US and WeWork acquired some time ago. It actually has now been reacquired by the original founders of that business, but mostly it was working for WeWork more recently. But it does have a wider customer base, but it has a very narrow focus, it's very specific around business and management, and if you like, meeting rooms as well. So it doesn't really have, it doesn't really, if you like, cover the depth of capability and the operating capability or even the digital experience in these spaces like we did. So hopefully that answers that, Alastair. Moving on to Miles R, how many sites came with the 18 new customers and how many from the largest customers? Well, obviously Miles, those 18 new customers bring a smaller number of sites as they first come on board. Obviously, mostly they are commercial real estate companies and landlords, and downstream from their initial sites that they deliver or book with us or contract with us, there will be significant opportunity. And actually you can see with the Tishman journey as we talked about before, that there and these 18 customers are, their strategic opportunity, we only focus on multi site large scale opportunities now. And so we will see significant downstream potential and expansion revenues from those customers over time. I'm quite I'm quite confident that if I if I get stuck, I will shout. Alastair Elle, I think I'm losing network. Yeah. Just a little bit, but can offer. Yeah. Thank you very much. Let me just bring the slides for you as well, just so we've got some point of reference if needed. Okay, thanks Mark. So could you comment please on how you see spend on developments evolving over the next 5 years? You've been adding lots of products recently, do you envisage continuing at a similar pace or will things slow? That's from Alistair. So undoubtedly post IPO, we've significantly ramped up our spend on research and product and development. But that is still at a very low level in comparison to many SaaS businesses of our size. So we continue, if you like, we will continue at a similar pace because there's many things where we can add value and deliver new product and capability. This is a rapidly evolving market and we wanna stay ahead significantly. And so one thing to note is we will only deliver product that solves for real problems. We're not into crazy moonshots, we're not into developing or using technology for technology's sake, or because it's the next big thing. We wanna sell real world problems for our customers and that's why we looked at access control because there was no real time solutions that allowed me to walk through a space and just have the doors open that I need to have access to, having booked them 5 minutes ago. And so we'll continue to definitely invest in product and development, but as a proportion of our revenues, obviously we'll consider about how that proportion looks over time. And miles are, are Connected and Operate going to continue to be the reporting segments, where do STEP Marketplace and the future Flex services platform fits into those? Well Connected and Operate will continue and we'll obviously add Flex Services platform to the reporting lines as we go forward. And STEP, if you like, was the precursor to the new commercial model that sits behind our Flex Services platform. So whilst it's not a specific product line, it is a proposition element and we'll be reporting on that as part of Flex Services platform as we go forward. And marketplace, you'll see that mix of revenues change in the future and we'll still reference those as we bring our results to market. And hopefully, you'll see that the Flex Services platform, which is on a price per square foot basis, is really aligned to the real estate industry and how they think about things. And actually, it can go much further into the building. So actually, our revenue opportunity per building, we think is increasing significantly following the larger Flex Services platform. Paul C asks, would it be possible to illustrate what your competitive edge is in your business? I think we have a number of things, Paul. I think firstly, 15 years of experience and money cannot buy time and so we are deeply embedded into the sector. We understand the problems when we solve for them through technology and software. And so we have a very deep understanding which comes out in our products, so we are if you like, really compelling from a product point of view. But that experience allied to our, if you like, our resources as a public company means that today we are the market leader and that's important because real estate doesn't like risk. The real estate industry wants to make sure that when they make decisions, they're making these long term and they're strategic. And so we have that opportunity to leverage our brand, our product market fit, our proven records, and also our roadmap with customers who are highly referenceable. So if you think this is a small industry in terms of many real estate companies all know each other, so we see that network effect building. Undoubtedly though, we will stay paranoid and we'll be very aware of competitive threats and competitive changes in the landscape. And Miles R. Asks, I've got a few more questions, I'll get through a few more. Miles R. Asked, can you give a little more color on the weakness in the UK? To what extent is that a function of the market structure with a more concentrated market, e. G, IWG, WeWork and Workspace? And do those 3 have their own internal software systems? Are they potential customers? Or are they seen more as competitors to your customers? So undoubtedly, they are competitors to our customers. And IWG and WeWork being the 2 standout examples have definitely tried and in some cases succeeded to deliver their own technology. But interestingly, we wanna enable the rest of the market. And so for us, it's about rework and IWGP in a much smaller portion of the overall opportunity over time. And so we have the opportunity to enable the rest of the workspace industry, the flex workspace industry and the wider commercial real estate industry using what we think is best of breed technology. And so the weakness in the UK is a little bit around, it's certainly a more mature market, it's certainly we've had a higher proportion of marketplace revenues because of the consumption, the occupancy in these spaces, and it's certainly also a little bit behind in terms of thinking about digital transformation, but we definitely expect the UK to move back to growth post pandemic. Simon C asks, are you winning new business through new large landlords clients who are rolling out across their estates? If so, how does penetration on average of their how much penetration on average of their portfolio do you have? And again, I'll talk to that Tish Inspire example. So our penetration is very low across all of our customers. You can see that's 10,000,000,000 square feet of opportunity. And for flex service platform, that's a price per square foot per year platform. So if that returns $1.50 or $2 or $3 a square foot, that's a significant revenue opportunity just in our customer base alone. And that's why the landing and expanding part of our model is really important. And we underpin that with really low churn, our customers stay long term, are very sticky, and we grow with those customers too. Miles asked in the US pipeline how many sites is typical for the sort of operator you are targeting? What sort of software, etcetera, do they tend to have? Well, interestingly, most of this opportunity is greenfield, and so the landlords are looking at how they convert their space to be more flexible, how they convert that building to be more flexible. And because of that, we can sit alongside existing software platforms that they use to manage the assets, so the things that they use to manage quarterly rent rolls and quarterly service charges. We can sit as best of breed for the more flexible operations of the space, the more customer centric experiences. And actually, the back office elements that they've been used to dealing with for many years and have systems in place, we can work and integrate alongside those, and they may even have things like CRM or HubSpot or Salesforce or or beta, or BI tools that we can integrate with. So we're very much a best of breed for Flex, and we expect that to be more of the building over time. But we expect to work alongside existing software stacks and technology stacks in buildings too. With Industrious, are you in the majority of their sites? And so the opportunity comes from growing with them. With Industrious, we're all in all of their sites, we are embedded and with the CBRE investments in Industrious recently, we are also expecting that actually will become part of the HANA CBRE FlexWare Express product over time too. But yeah, absolutely an opportunity comes with industrious as they grow too, and we've seen that growth significantly over the last few years. Miles are, how quickly would you expect existing customers to move over to the Flex platform? How would pricing compare to their existing services from a census? Well, interestingly, the pricing, if you like, comparatively per square foot is very similar. But what the Flex service platform does, it provides a lower and easier entry point for bigger landlords, but also reduces the ceiling. So as these expand, these services expand in the building, and we'll expand with them, and obviously, the upside potential for us and for the operator is significant. In terms of how quickly, we're working with all of our customers on that transition and the migration plan. We're offering grandfather pricing incentives to move them over. But actually, the experience is much more powerful, the platform is much more capable, and so there is, if you like, an appetite to quickly move on to Flex Services platform from those customers as well. Let's see how many more questions. Okay, we're catching up. How much presence do your existing UK and US customers have in APAC and Europe? Is that the main initial route to market? And that's again from Miles. Yes, our customers do pull us into those new territories, Tissue Inspire taking us into Brazil, and we've seen customer pull into APAC, and we've also had Tissue Inspire previously in Europe. And so we have customer pull, which is like drag, but also we've built on the back of those customers, we have referenceability, we have new routes to market through, if you like, putting a go to market strategy together for those territories. And Miles asked what sort of product and services are you replacing for customer attrition? Well, to my answer before, actually, because we are delivering the flex element and our software delivers against that requirement, we are complementary to some of the existing capabilities they have, and so as the journey to flex accelerates, our products, if you like, grow in those spaces. And so Tishman, for us, it was, they looked at how to deliver this, how to deliver the technology and the experience, and when they looked at it, they thought Ascensus was the right answer, and obviously we've grown with them over time. And Oscar, he asks, do you have certain clients as super users to test new products and services? Absolutely work alongside our clients and customers in terms of user groups, in terms of alpha trials and early deployments of products to make sure that the requirements meet the needs and we solve for those problems. And also, as you can see, we've got very early stage and very innovative products and services, but actually might never make it out of the Census Labs if they don't meet the requirements of the use case or of the industry. And Myers asks, as the market leader, are there areas where products you might expand into by acquisition? We're absolutely always looking for opportunities to accelerate our growth. And actually, whether that's technology acquisition in areas we don't currently have coverage or whether or not that's acquisition of revenue or customer bases or even into territories, we're obviously very aware and very keen to look at those opportunities. But not many exist really. If you think about our evolution in the industry, we're the market leader, most competitors are subscale, and most technologies have not been developed specifically for the use cases of Flex. Thank you. Miles, thank you. It's a very nice comment at the end, which is thanking us for a good presentation. Thank you very much indeed. Obviously, I think you've just come down to the last question. That's not a question, but more just a reflection of your engagement during this Q and A, which and thank you firstly to the investors that have submitted all those questions. We definitely do appreciate that level of engagement. Obviously, before we get interrupted by broadband, Mark, if I could just hand back to you just for a few closing remarks. And then what I'd like to do is divert investors to provide feedback. And if investors could do that, that would be most grateful. That's great. Thanks, Mark. You can actually close the presentation, I think. Well, thank you all for joining us today. We think this is a really exciting time for Ascensus. We think the journey is really just beginning for us and for the industry and for the market opportunity. And our job is mostly not to cock it up and to stay ambitious, stay paranoid and stay committed to the sector. Listen, learn and react. And hopefully you'll be with us for that Gen 2. Thank you all for taking the time to join us today. We hope to see you on one of the IMC broadcast in future. Thanks a lot, Will. Mark, Allen, thank you very much indeed for updating investors today. Could I please ask investors not to close this session as you'll be automatically redirected for the opportunity to provide your feedback? If you access this meeting from our website, then the feedback page will appear. But if you access this meeting via the link sent to you by email, you'll simply be asked to log back in to submit your feedback. And I would encourage you, if you could spend the time just to let the company know your views and expectations. On behalf of the management team of Ascensus, we'd like to thank you very much for attending this afternoon's presentation. That now concludes today's session, and good afternoon to you all. Thanks once again.