Hello, everyone, and welcome to Alfa's 2023 first half results presentation. I'm Andrew Denton, I'm Alfa's CEO, and I'm joined by Matthew White, Alfa's COO, and Duncan Magrath, Alfa's CFO, in presenting to you today. Starting with slide five, the overview, it's been a really good half. Excellent fundamentals, which is something that we always measure on. Strong financial performance, with both revenue and profit up by around 20%. I'll get underneath that number in a second, and Duncan, of course, will spend a lot of time talking about the financial results. Underpinning that has been a strong customer-led software development line. That's up 33% from this time last year. We continue to focus on the resilience and the diversification of our business.
Customer concentration, which is the revenue apportioned to our top five customers, now sits at 36%, and you'll know that we've started to measure the number of customers that are contributing greater than GBP 2 million, and that now stands at 18 customers. This time around, Duncan's going to be talking about the end markets in which we operate, and 15 end markets, again, shows a lot of diversification in where Alfa is selling software. Again, we've had industry-leading software delivery. 14 delivery events in total, and that accounts for two new customers and one new region as Mexico comes online with Alfa. And again, we've had high staff retention and engagement, which I'll talk about on the next slide. We've also had great strategic progress this half.
Subscription has grown again, 14%, and I'll talk about that in a second, and we've also expanded our partnership, including now into the U.S., with our second US partner now operational. We've seen further investment in the product, which Matthew will talk about, and also we've made great progress in our environmental targets, and I'll talk about that when we talk about our impact. Looking forward, we will, of course, continue to invest in our product. For 2023, we'll see a greater level of Alfa-led investment in the second half as we execute our roadmap plans. This is taking us towards the sixth major version release, and we'll be announcing that in Q3, telling the world about Alfa version six. We've been moving towards partner-led delivery, which Matthew will talk about, and partner-led delivery increases our operational leverage.
It's a really important factor in allowing us to grow faster. A real highlight of the half has been the sales success that Alfa has seen. We have a strong late stage pipeline, which I'll unpack later. That includes one Alfa Start win and three more prospects added as at the 30th of August. But more impressively, we are unopposed in 10 out of the 11 customers in the late stage pipeline. We are preferred supplier, and we're doing implementation work with four of those 11. The other important point to make with respect to the sales cycle is that that cycle has remained unchanged. We're seeing no changes to cycle times and no changes to our customers' buying behavior, which gives us great confidence. That confidence in our expectations and our prospects has led the board to declare a special dividend of GBP 11.8 million.
Moving then to the highlights, and starting with revenue. Duncan, as I've said, will talk about all of these in detail, but in the half, we have achieved a revenue of GBP 52.9 million. That's a revenue movement up 21% from this time last year. I mentioned that all important growth in subscription revenues of 14%. Underpinning that is an increase in Alfa Cloud revenues of 33%. That leads us now to have 14 Alfa Cloud customers in total. Operating profit at GBP 16.9 million was up 19%, and we have sustained an operating profit margin of 32%. Closing headcount at 11%, with an average headcount up 14%.
A big driver in headcount growth, or at least headcount sustainability, has been staff retention, and we now see that at 95%, which is up from June 2022's 85%. Finally, with respect to total contract value, that is even with 2022 at GBP 138 million. But it's important to look actually at the late stage pipeline. We're working with 3 very large prospects in that late stage pipeline, and if those were signed and included in the total contract value, that would add GBP 30 million to the 138. So we feel like we're in an extremely good position in terms of revenue visibility. I'll now hand over to Duncan for the financials.
Thanks, Andy. As you can see, we've had a really strong financial performance. Revenue was up 21% in the period, or 18% at constant currency, which benefited from a strong first half weighting for customer-funded development. Operating profit grew by 19%, maintaining a 32% margin. The effective tax rate of 20% was higher than last year on the back of the increase in the UK corporation tax rate, resulting in basic EPS up 15%, with diluted EPS up 16%. So overall, an excellent financial performance in the first half of 2023. As previously highlighted, we have significantly increased the diversification of our customer base, with top five customers now representing 36% of our revenues. What we have not previously highlighted is the diversification we have in our end markets.
The diagram on the left shows this, with each block representing a different end market in proportion to revenue. I won't go through this in detail, but the key point is that we are spread across 15 end markets, which gives us great resilience to changes in any one market. We continue to build out our base of customers, with customers with more than GBP 2 million of annual revenues now up to 18. Turning now to TCV. I'm starting this time with the overall picture of TCV before showing each component within their respective revenue streams. Total TCV of GBP 138 million was in line with this time last year, although slightly down on the year-end position, partly due to an FX headwind. The next 12 months TCV shows a similar picture.
As you know, we've only included new customers in full in TCV once all contract packs are signed. We're coming to the end of a number of implementation projects, and so naturally, the software and services TCV is declining. We have talked before how implementation projects are changing, so often projects start in parallel with finalizing the contracting process. At the 30th of June, we were working with a number of new prospects in the late-stage pipeline. However, as these were not fully contracted, and so we only included within TCV signed statements of work, which are relatively short in duration and do not cover the whole of the project.
To illustrate this, if we assume that the three new customers in the later stage pipeline that we are working with had been signed at the 30th of June, TCV would have been GBP 168 million, 21 higher and also 21% up on this time last year, with the most significant impact on our services TCV. Turning now to the first of our three revenue streams, subscription revenues. Subscription revenues, which account for 29% of our business, increased 14% over last year, with revenues increasing from GBP 13.5 million to GBP 15.4 million. Within this, Alfa Cloud hosting has continued to grow strongly, up by 33%. You can see the continued forward momentum in our subscription revenues, with TCV also up 14%. Moving on to our second revenue stream, software. Software revenues increased very strongly, up 33% on last year.
I have split the revenues down into three categories. Firstly, revenue from enhancement work. Secondly, customized license revenue, which includes software development days, along with the perpetual license. And thirdly, one-off license fees. You can see the strong growth in software revenues was largely due to the growth in enhancement work, which was up from GBP 3.5 million in the first half last year to GBP 5.6 million this year. Last year, approximately 40% of the development was in the first half, whereas this year it was approximately 60% in the first half. The effect will obviously reverse in the second half, with the lower enhancement revenues this year versus a strong second half last year. Customized license revenues were in line with last year.
These come from customers who have bought perpetual licenses, and given that most customers now purchase subscription licenses, which are included in subscription revenue stream, we will see these revenues decline over time. One-off license fees were slightly up from GBP 0.2 million last year to GBP 0.3 million this year. TCV is down 19% versus the same time last year, and this is due to some existing projects getting towards the end of their implementation, with software development reducing in the lead up to go live and consistent with the expected reduction in customer-funded development in the second half that I've just mentioned. Software development for the new projects that are starting up will only ramp up once designs have been completed and will be included in TCV once contracts are signed. Turning to our final revenue stream, services.
Total services revenue increased by 21% to GBP 28.6 million on the back of the increased headcount and strong progress on projects. Existing customer revenues, including V4 to V5 upgrades, accounted for 67% of the services revenues. Partner days were 8% of the overall total. This was down on last year, due mainly to last year having some partners on client sites on projects. TCV is down 31% versus the same time last year, and this is due to those existing projects getting towards the end of their implementation and the new projects not yet contracted. As noted earlier, if they had contracted, our services TCV would have been nearly double that shown here. Turning now to expenses. Overall costs increased 21% on the first half last year.
Salary costs, the biggest component, increased 19% over last year, with average headcount up 14%. Other SG&A costs grew more slowly, up 10% to GBP 7.9 million. Profit share increased to GBP 2.1 million on the back of the higher profits. FX gains were lower than last year, and also other income was down following the assignment of one of the floors of the London office, which used to be sublet, although this is offset by a lower depreciation charge. I've shown separately the GBP 0.5 million of legal costs that we incurred in the first half in relation to the possible offer for the company. Turning to cash flow. We delivered another strong cash performance. The half year cash flow is always impacted by the annual maintenance billing cycle and how much of that is collected by the thirtieth of June.
This year, the vast majority of it was collected, whereas last year, some was collected in July, and so cash conversion was up from 112% last year to 140% this year. As previously mentioned, for a full 12 months, we expect to operate around 100% cash conversion going forwards. We had GBP 4.7 million in share purchases in the period. GBP 3.1 million arose from purchases under the share buyback scheme, with GBP 1.6 million from purchases of shares for the EBT, which helped offset any dilution from vesting of share schemes. We also paid GBP 7.9 million of dividends in the period. So now on to the balance sheet. Picking out some key items, and firstly, trade receivables.
As noted on the last slide, we did really well on the collection of maintenance invoices in H1, so trade receivables were down from the year-end, despite higher revenues, and this shows the strength of our blue chip customer base, and they continue to pay us on time. The higher revenues did, however, increase prepayments and accrued income. Cash increased to GBP 26.3 million on the back of the strong cash generation, even after funding GBP 7.9 million of dividends and GBP 4.7 million of share purchases. Maintenance contract liabilities did increase from the year-end to GBP 11.1 million due to the annual cycle I referred to on the last slide. Now some words on capital allocation.
We completed the share buyback program at the end of June, and having assessed our options, we have decided that for the time being, we consider paying ordinary dividends, topped up by special dividends, as the easiest and quickest method of returning excess cash to shareholders. We like the split of a relatively low ordinary dividend with the use of a higher special dividend, as enables us to retain a degree of optionality. Given the levels of cash in the business, we have declared a special dividend of GBP 0.04 per share, amounting to GBP 11.8 million, which will be paid to shareholders on the sixth of October, adding to the GBP 107 million of dividends that have been paid over the last three years. Next, a brief update on modeling guidance.
As noted earlier, customer-funded development will be lower in H2, with investment into internal product development, ensuring that we continue to deliver our product roadmap. We expect the full year effective tax rate to be circa 20%, similar to the level at the half year. This will increase in 2024, as we will have a full year of the 25% U.K. corporation tax rate, along with no benefit from R&D on the tax line, as we are now in what is called the RDEC scheme. Currency sensitivity remains unchanged. The figures quoted here are for a full 12 months. I will now hand over to Matt.
Thanks, Duncan. We're continuing to make really good progress in all areas of our strategy, and as I go along today, I'll refer to our strategic priorities, and I'll highlight how our activities in the first half of the year have furthered our strategic aims. Apart from our strategy, my focus is on our product, the delivery of our product to customers, and on our people. Our software, which is built on leading-edge technology, is ahead of anything else in the asset finance market. Our key advantage is in the middle and back office. The complex finance operations, which provide varied financial products for varied types of assets in varied markets, and we're the only proven modern solution for volume. So our software is extremely sticky, but the ability to serve this complexity also gives us an unrivaled platform for smaller players with simpler requirements.
We work with our customers to innovate so that they can stay ahead of their competition. This means that our competitive moat is continually refreshed as we strengthen our product. As Duncan said, H1 was weighted towards client-led development. That's partly because we have many customers nearing go live. In this slide, I've highlighted a selection of recent product enhancements that I haven't mentioned before in this forum. All of these features will form part of a major new release of Alfa Systems, which we plan to announce over the coming months. Alfa Compose represents a step change for our user interface, introducing customizable screens for individual use cases. We're making major improvements to our frame agreement functionality, which allows templating for new business and for new products to be brought to market quickly and with ease.
We're working with our user group to define and implement greenhouse gas emission reporting at asset level, and we have a lot of work ongoing at the moment to improve our Operational Data Store, which is our reporting database. Rich functionality in this area is vital to aid integration into clients' systems architecture. We're also thinking about how we might increase the scope of our target market still further as we scale. We're starting work on out-of-the-box interfaces required for the US Start market, and we're also improving our support for commercial loans, which could introduce an entirely new set of customers for Alfa. Since the turn of the year, we have completed our move to containerize Docker deployment for all hosted customers, and we're now moving on-premises clients to Docker as part of our drive for simplification.
Another ongoing simplification initiative, this one is very much the result of bottom-up innovation, is Alfa One. Here, we're looking at how our implementations differ between clients, and we're eliminating unnecessary, unnecessary differentiation. This is really important to our plans for partner-led delivery. We're proud of how we do things at Alfa, but every so often we take a moment and really make sure that we're as efficient and as effective as possible as we continue to scale. We've spent some time reviewing our approach to software development and making it better together in line with our values. We're implementing our Alfa Development Model, which is illustrated on this slide. This is a refresh of our methodology for enhancing our software. Our Alfa Development Model is even more agile and responsive to changes in customer requirements.
It's even more flexible for changing demands in throughput, and it's even more collaborative within our teams and with customers. Subscription pricing and our Alfa Cloud hosted offering is now our default. It's important that we maintain the flexibility to provide an on-premise option, because a minority of our customers prefer to use their own cloud. But for many of our customers, we are a SaaS provider. And as Andy and Duncan have outlined, Alfa Cloud hosting revenues are growing fast as customers take advantage of our compelling offering in this area. It's important to emphasize that we are a software and delivery company. We never forget that our efforts all come together with successful delivery of our software for customers. We are the risk-free choice for complex change projects in asset finance, and we continue to strengthen our delivery differentiation.
As Andy said, we've maintained our delivery cadence with 14 deliveries in H1, including two new customer go-lives. Plus, Alfa is now live in Mexico, our 38th country. Since the period ended, we have a new customer on Alfa V5, because we've completed the initial phase of a V5 upgrade with a long-standing customer. We have 14 ongoing new implementations of Alfa Systems, which includes four ongoing V4 to V5 upgrades and 10 new implementations. Every new implementation of Alfa brings a new layer of subscription revenue. More information on our delivery progress can be found in the appendix to this presentation. We're also continuing to simplify our software delivery and ongoing maintenance. For example, we're formalizing our approach to long-term support branches, and we're further improving our volume migration approach and tooling.
All of the progress that I talked about today has, of course, been achieved by our fantastic team, and that team is continuing to grow as we continue to scale and strengthen. Our people strategy is clear and targeted at attracting, developing, engaging, and retaining the best talent in the industries in which we work. We are an exciting proposition for new recruits. We offer the benefits of both entrepreneurial and innovative fintech, and stable and established PLC, with a great existing team and a conscience. So we're continuing to attract really talented people, including into our Lisbon Smart Hub, which is working really well and provides a blueprint for potential further Smart Hubs in the future. As I said in March, after fast growth in headcount in 2022, recruitment has been more measured in 2023 as we consolidate experience levels.
We expect average headcount for the year as a whole to increase by around 9%, which will take us to a 20% increase in average headcount over two years. We're bringing together various strands of our comprehensive talent management framework to create an even more cohesive approach, and we're revamping our induction training to enable better preparation for client-facing work more quickly. We're also further investing in our leadership training at all levels of the company. Consistently effective supervision and leadership is even more important in a hybrid working environment. We've had nearly two years of outstanding smart working at Alfa, and we're continuing to review our approach to working practices. We're getting the most out of co-location, while enabling the flexibility of home working and the recruitment and retention of remote workers.
Our engagement score remains very high at 79%, and continued excellent retention is an outcome of our people strategy. And as well as our own team, we're increasingly able to draw on an excellent team of partners. Partnering brings many benefits for Alfa, including increased delivery capacity, enabling us to scale, flexibility for project resourcing, sales leads through an expanded network, and a pool of expertise for client-side resourcing, enabling our customers to succeed. We're now operational with our second US staff augmentation partner, and our plan to moving to partner-led delivery has been refined and is making real progress. As Andy mentioned, this is a key strategic focus for us. We're enabling partners to take on more tasks within implementation projects. Roles that would previously have been limited to members of the Alfa team can now be carried out by partners.
We're enabling access to additional collateral for partner team members, and for the first time, we now have a partner team member working in a staff augmentation role on an Alfa Start project. A UK equipment Start project takes only 20 weeks, with a team of only three people. The fact that we have now enabled a partner to work with us on one of these projects is a huge step towards that goal of partner-led implementation. That's all from me, and I'll hand back to Andy.
Thanks, Matt. Now continuing with the business and sales update, and starting with creating a positive impact. Creating a positive impact is one of our core values, and as Matthew said, we are a business that takes pride in having a conscience. The key focus of the half was the environment, with a number of highlights, including confirming our net zero journey with Science Based Targets at the heart of it, a second colleague commuting survey, so that we understand our own impact. On the product side, greenhouse gas and emissions functionality inside Alfa, so that not only can we focus on our impact on the environment, but we can also help our customers operate, understanding their impact, or at least the impact of the business that they do.
At the other side of our supply chain, we have changed our onboarding process to include ESG factors, including, clearly, the environment, so that we have a better understanding and better control of the people that we work with. We talk about culture an awful lot, and culture is very much part of the support in creating a positive impact and a big driver to the way that the business operates. We've touched on the pulse survey, our engagement score, a couple of times, Matt just now, and with 78% in Q1 this year and 79% in Q2 this year, the engagement score remains very high. We've just completed our first annual diversity, equity, and inclusion survey. We've done that so that we can understand and target our cultural initiatives even more.
Part of supporting that great workforce that Matthew talked about is making sure that our colleagues get all the training that they need. We've developed new content, which has been released within Workday Learning. Over 200 courses and six Alfa podcasts are now available for our colleagues to access and continue their own training, augmented with company events and hackathons, more in-person events to stoke that culture. And of course, there was a possible offer during the period, and communications around that, making sure that the business stayed in the best possible place, were very well received. Every time I talk about creating a positive impact to this audience, I talk about the incredible initiatives that come from Alfa's communities.
I'm not going to pick any out, and I'm not going to go through these in complete detail, but the slide shows the strength and depth of the impact those communities are having. To reiterate, it's very important to us that these communities are driven and owned by colleagues, with leadership just providing guidance and support in making that impact. We feel it's been a really good half in terms of creating that positive impact and having a conscience. Moving to that late-stage pipeline and the movement in the period. During the period itself, we added two prospects to that late-stage pipeline, one of which we converted into a win during the period, which gives you a real feel for the speed at which the pipeline is moving and for our confidence in buying behavior.
We had one prospect move back to the mid-stage pipeline, and that gives us a total of nine prospects at the end of the period itself. We wanted, though, to give you a feel for the pace of movement within that pipeline and the progress that we're making, so we can then add another two new prospects up to August the 31st this year, giving us a total of 11. So that means we've added three, and we've sold one during the period up to 31st of August 2023. We're working right now with four in total, three of which, if we added those to the TCV, would add another GBP 30 million, as Duncan outlined, and we are preferred supplier, unopposed, with 10 out of the 11. All of these things give us a huge amount of confidence in that all-important pipeline and its ability to fuel our future growth.
Which takes me to the overall outlook as we repeat and consolidate a lot of the messages that we've already made during this presentation. Our full year expectations remain unchanged. The market for new software remains strong in all sectors. We have a great late-stage pipe and really strong inbound inquiries as we see no changes to the way that we sell and the behavior of the markets that we serve. Our business remains resilient. We've all talked about that reduced customer concentration, now standing at 36%, and 18 of our customers contributing more than GBP 2 million to our total revenue. Duncan outlined the diverse markets we serve, and both Matthew and I talked about the number of countries where Alfa is now operational. Giving a great foundation to our business is the growing subscription revenues, which also is part of our resilience.
ARR, our subscription revenue stream, up 14% during the period, and as we've said, Alfa Cloud, underneath that, was up 33%. That strong first half has been underpinned by software developments, as we've mentioned, with software development revenues increasing by 33%. In the second half, we're going to knuckle down and see some increased investment to stay in line with our product roadmap plans and further extend that competitive advantage that Matt set out so eloquently. All of that as we drive towards version six of the software. In summary, the half has seen, again, excellent fundamentals. We're really pleased with the underlying performance, the things that are really important to what we do, not just the finances, but software delivery and making sure that our people are retained and engaged. We continue to make strategic progress as we step into our opportunity.
Subscription is growing. We're expanding our partnership, and that includes, as we look forward, moving into partner-led delivery, with real progress on that in this half. We're investing in our product to extend our competitive advantage, and we validated our emission targets and our net zero target by 2050, as I said, using Science-Based Targets. As we go forward into the second half, we will further invest in our product, a greater level of Alfa-led development in the second half. And as we've all said, that is driving us towards that sixth major version to be announced in quarter three, and it will be very exciting indeed, as Matt has already given you a bit of a trailer of some of the functionality you can expect and the impact that that will have on the markets that we serve. I've talked a couple of times about the sales success.
Of course, keeping that momentum in the late stage pipeline and within our overall pipeline is key to our prospects, and we feel we're in a great place with respect to the pipeline. And all of that confidence in our expectations and our prospects has led the board to declare a GBP 11.8 million special dividend. We thank you for your attention, and look forward to question and answer. Thank you.
If you wish to ask a question at this time, please signal by pressing star one on your telephone keypad. Please make sure the mute function on your phone is switched off to allow your signal to reach our equipment. Again, it is star one to ask a question. The first question comes from James Goodman from Barclays. Please go ahead.
Yeah, morning. Thanks a lot. A couple of questions, firstly, around V6, and maybe I'll come back on, on the competitive environment and the, and the win rates. Just, just around V6, I mean, maybe you could talk a little bit more about, maybe what—by, by way of compare and contrast to, to V5, what the sort of magnitude of change is for your client base there, and, and I, I guess, what, what the revenue opportunity, you know, might, might be associated to that. Maybe you could also touch on just the amount of, internal development that's being done versus what's left to be done. And I guess the, the final part of the question around that is, you're obviously going through a transition where you've got a number of go lives this year.
You've got a very strong pipeline and a number of customers in the process of being converted. If that demand comes through more quickly than expected, I'm trying to work out whether you'll prioritize this internal development or whether you can flex that a little bit in order to satisfy any additional customer demand. And then I'll come back with a second one. Thank you.
Well, good morning, James. Thanks, very much for the questions. Let's start with V6. It's a very insightful question in comparing it to V5. V5 was very much an architectural and technical upgrade. As we look back to 2008 and some of the decisions that we took in 2008, I think we can be very, very pleased and proud that we managed to create a cloud native system before the phrase had even been coined. So as we look at V5, and we look at the major technical building blocks, and actually the way we've taken it forward from a technology perspective, we see Java as still being the right environment to develop enterprise software.
We've always been database agnostic through the use of the Hibernate libraries, which means that something like Aurora Serverless 2.0, and before it, Postgres, was very easy for Alfa to adopt as new database technologies. And we've had that web presentation, and Matt talked about the coming of Alfa Compose as taking it to yet another new level as we cycle through user experience in Alfa. We also talked about some of the things that we're doing around the technology, such as finalizing the move to Docker deployment, for instance. And Matt talked about the work that we're doing around data pipeline in the operational data store. So as we validate the technology that we've built on, we see no reason to change it at all.
But what we do see, standing where we are today, is from the point that V5 was conceived and then delivered in 2010, you've got 13 years of functional development, some very major steps forward, like wholesale and dealer accounts. You've got an awful lot of functionality that's gone in for individual markets, including the loan stuff that Matt talked about, and a number of pretty transformational functional moves forward that are in train. So we took the decision that we would announce V6, if not now, then when? Because we've got to a position where the software advances over V5 in 2010 are just enormous. But your question is highly germane, because these are functional moves forward.
So in terms of the friction, you could use the word, that would be caused by going from V5 to V6, it's zero friction. In fact, by the time we actually get to announcing V6 to the industry and technical and investment press, then most of our customers will have the vast majority of V6 already in train. So in terms of the revenue opportunity, four to five was a revenue opportunity in terms of services days. Of course, we've talked to the investment community quite a few times about the fact that that's a double-edged investment opportunity. We're proud and pleased that these customers are continuing their journey with us, and it's given us the opportunity to move towards a subscription-based sales approach without missing a heartbeat from a financial performance perspective.
But we'd rather be spending our time actually implementing brand new customers, and creating the subscription revenue streams that come along with them, rather than doing those upgrades. So that brings us to the revenue opportunity that comes with version six. And all of these major functional move forward, moves forward, rather, are modules. So the no friction upgrade that you get in version six is also a no friction sales opportunity for Alfa to spin up these new modules with customers, providing even more value, but also giving us a revenue opportunity in so doing... So we're excited about V6, and we're extremely exciting about that complete lack of friction, and within our customer base in getting people to this next level of software functionality.
In terms of that transition and how we might deal with extra demand, then, Matthew talked actually about our development model. And it's one of those, underneath the hood or bonnet, depending which side of the Atlantic you are, moves for Alfa, in terms of making us more efficient, allowing us to do more, allowing us to be more agile and more responsive. And that forms part of our ability to pivot. So absolutely, we are in a position to handle any extra demand if the software developments that come along with these new customers, and particularly ones that we're working with actively, do come along in a more timely way.
We will always, though, be conscious of making sure that we, and you've heard me say this before, mend the roof while the sun shines. Our investment agenda is incredibly important to us, and we need to retain that balance, and we're aware very much that the new customers who are coming on stream absolutely appreciate our focus on mending the roof while the sun shines. So we can certainly pivot, we can certainly be agile, but we will absolutely be delivering our investment agenda in H2.
Perfect. Thanks for the complete answers. So just the other question, just around, I guess, looking at slide 29 and the late stage pipeline. No clients lost out of that stage of the pipeline all year, and I'm just looking quickly back at last year, I don't think you lost a single one during FY 2022 either. So in a very encouraging from that perspective, but maybe you can comment a bit more generally around your win rates across multiple stages of the pipeline. Are they, you know, as high as they appear from the late stage pipeline development?
And then I guess, related to that, just some color and update around the competitive environment, because there has been quite a lot of change in, you know, the competitor sort of ownership and, whether you're seeing any evolution there or whether it's the same competitors that you're seeing in the majority of tenders? Thank you.
Thanks again for that one, James. I'll pick it up. The pipeline is as presented, I guess. Actually, one of the things that we are seeing in terms of the way that we sell software has evolved is that people are much more likely to start work in parallel to agreeing a full contract pack than ever before, which is one of the reasons why Duncan picked out, in his presentation of TCV, the fact that the three that we're working with, which we're working with in a very active implementation mode, that they would add that extra £30 million to the TCV, which is one of the things that gives us real confidence and encouragement in our prospects.
We do qualify carefully. You'll be aware that Alfa is very wedded to its principles from the way that we deliver software through to the way that we protect the company. And certainly, the way to picture the late stage pipeline is that in a fair fight, I suppose, where everybody's protecting their businesses and everybody is taking a balanced level of commercial risk, then we would expect to have an excellent chance. We don't, or at least we try not to indulge in any hubris. We're always very cognizant of the competitive environment and that people are trying very hard up against us. We have some strong competition out there.
But we're also very confident in our solution and our proposition, and I would like to say that the figures are speaking for themselves. In terms of the competitive landscape, and again, sidestepping any hubris, if I look at the way that Alfa presents, Alfa can present based on an exceptional delivery track record. We talked about the 14 H1 delivery events, two new customers, brand new customers, going live during the period and one since the period end, bringing on stream our thirty-eighth country. We do have an industry-leading delivery record. We do have a true single product strategy that we are able to deliver to Alfa's customers, and those absolutely differentiate us.
And adding to that, our strategy and our plan, we lead with those things, and I think that differentiates us from the current competitive landscape.
Thank you very much.
As a reminder, to ask a question, please signal by pressing star one. The next question comes from Harvey Robinson of Panmure Gordon. Please go ahead.
Morning, guys. Can you hear me okay?
Yeah, we can. Thanks, Harvey.
All right. Sorry. I've got three questions here. I'll definitely make it quite short, though.
... Just a couple questions relating to slides, points Matthew made. Obviously, you talked of partnership capacity and what that might do to your overall delivery capability. Could you just give us a feel for what that might mean in sort of percentage of work that you could do versus where you are today? And also, I noted, you made an announcement re AWS recently, how that's related to that or not related, which I thought was quite positive. The second question would be, can you give us a feel for where you are in the commercial loan journey? I know you have a lead customer there, but, you know, looking medium-term, how big could that be? And the final question really comes back to the three customers that are not quite yet in TCV.
If you were to rank those customers once they're up and deployed, where would they sit? Would they be top five customers? Could it be your largest customer? I mean, nice to get a feel for how big they could be. It sounds like they are very significant. Thank you.
Thanks, Harvey, and good morning. I might take your questions in reverse order, since we finished off with James talking about the pipeline. The three customers that we're talking about are all big names. So in terms of how they contribute to TCV right now, then they're probably fairly evenly split. In terms of the opportunity that they create going forward, a couple of them are enormous, but all of them absolutely have the capability, I suppose, of being top five customers.
But the way I would qualify that is, again, looking at the strength of the pipeline and the number of implementations that we have in train right now, there are a lot of people vying, I suppose, to be top five customers, and again, noting our continued focus on customer concentration. But undoubtedly, those three that you talk about would add to our 18 customers that are our top revenue contributors. And frankly, we're exceptionally excited about these brand names. They are incredible logos to be able to add to our roster of customers. In terms of commercial loans, we continue to mature the functionality in that area. As with everything, it's a continual journey.
We do feel that today, we have an excellent platform for commercial loans, and you're right to point out that we have a lead customer in terms of a pure commercial loan portfolio. The opportunity going forward, well, in terms of the total addressable market, then commercial loans is enormous. You might argue that it's quite a lot bigger than the addressable market within asset finance. So, upside is huge, and it it's great to be able to develop addressable market that can fuel our growth going forward. Probably next steps, and an obvious focus for commercial loans, will be on the commercial loan portfolio that lives with our existing customers. It's always easiest in terms of reducing friction in entering a new adjacent market if you can pivot off your existing market.
Most large asset finance companies have a commercial lending portfolio. So that will be our initial focus, but the opportunity is huge. I'll let Matt answer the detailed question in terms of partnership resource and what that could do for us in a second. AWS and the progress we're making in partnership, they're slightly different things, but I suppose you could describe AWS as one of our most, if not our most important partner. Not an implementation partner or an augmentation partner, but very much a key partner and a key working relationship in Alfa Cloud, which is our fastest growing product line, as you know. AWS very much powers that. We really like the technology that AWS gives us.
We ensure that we even though we don't have a multi-cloud implementation strategy, we certainly have a multi-cloud capability, so we're able to pivot cloud provider very quickly. But being certified by AWS as having the right architectural standards, as being able to use all of what they offer in a native way, is obviously a great accolade, and we're very proud of those that are leading and working within the Alfa Cloud business line for achieving that. Matt, perhaps you'd like to talk to what partnership could do for us in giving us scalability going forward.
Yeah. Just to finish off that AWS point, Harvey, I think the announcement that you saw recently was a certification from AWS, which can be important for some of our customers in seeing that validation from AWS themselves. It's a certification of something that has been in place for a while, so we've been working with AWS in how we provide those cloud-native services that we talk about. And I think we went through the process last year, but got the final certification through this year because it was something that was important to one of our customers. So it's more than a tick in a box, but something that was already in place and just been externally validated.
To pick up on the partnership point, I think I'm gonna use round numbers, and Duncan will correct me, but I think around about 10% of our days at the moment are our services days are performed by partners. There is potential for that to increase, although, of course, we are increasing our internal headcount at the same time. Important point to make, at the moment, we actually have a bit of a bench of partners trained up. That's going to be important to us as we move through that really exciting late-stage pipeline that Andy was talking about, because the flexibility that partner resource gives us is one of the key advantages.
I'd also point out, partners are important working client side, so working directly for customers on things like system integration, ensuring success for our programs. Partners are able to provide the real asset finance expertise and bring with them knowledge of Alfa to ensure that our projects are successful.
Brilliant.
That's great. Thank you. Very clear. Thank you.
Thank you. And is there any more further questions in the queue? I would like to hand the call back over to Andrew Denton for any additional or closing remarks.
Thank you very much. First of all, thank you, everybody, for giving us your time this morning and for the excellent questions, James and Harvey. We're, as you know, very, very excited about where we are and what we can do with the rest of the year. So, we'll continue to push forward and look forward to speaking to you at the full year with more great progress and more particularly around the sixth version of the software to report to you in terms of Alfa as a product. Thanks again.