LON:IHP IntegraFin H2 2024 Earnings Report GBX 306 +2.00 (+0.66%) As of 04/25/2025 11:57 AM Eastern Earnings HistoryForecast IntegraFin EPS ResultsActual EPSGBX 16.30Consensus EPS N/ABeat/MissN/AOne Year Ago EPSN/AIntegraFin Revenue ResultsActual RevenueN/AExpected RevenueN/ABeat/MissN/AYoY Revenue GrowthN/AIntegraFin Announcement DetailsQuarterH2 2024Date12/18/2024TimeBefore Market OpensConference Call DateWednesday, December 18, 2024Conference Call Time4:30AM ETConference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckReportEarnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by IntegraFin H2 2024 Earnings Call TranscriptProvided by QuartrDecember 18, 2024 ShareLink copied to clipboard.There are 6 speakers on the call. Operator00:00:00Good morning, and welcome to IntegraFi's Full Year Results Presentation. The presentation will be followed by the Q and A. I I would now like to hand the call over to Alex Scott, IHP Group's CEO. Please go ahead, sir. Thank you, Sergei. Operator00:00:19Thanks for the Speaker 100:00:20introduction, and good morning, everyone. As you know, I'm Alex Scott. I'm Group CEO of Integrafin. And with me today, I have Johan Martial Arts Group Chief Financial Officer. I'm going to kick off with an overview of highlights from the group's financial year, and then I'll hand over to Ewan to run you through the group's financial performance in the period. Speaker 100:00:40Then I'll give an update on the Transat platform performance and our strategic progress before moving to Q and A. We're very pleased that the Transact platform finished the year with record high levels of funds under direction, FUD, aided by strong net inflows onto the platform of £2,500,000,000 as advisers continue to deepen their trust in our market leading client service and platform functionality. We delivered record year revenues of £144,900,000 helped by the strong growth in daily average FUD during the period. The excellent performance by our staff in delivering our services and our platform functionality have been consistently recognized over the year, with TRANZACT bringing home the Schroders Awards for Best Large Platform and Best Platform for Discretionary Investment Management. Delivering positive client outcomes has always been at the forefront of what we do across the business, and we've continued to pass to clients all of the interest earned on their cash balances. Speaker 100:01:42Our established business model continued to drive growth in FUD clients and advisers over the course of the financial year. Adviser numbers were up 5% and client numbers up 2%, despite us continuing to close very small portfolios during those 12 months. The record levels of Group revenue drove underlying profit before tax up 12% and increased our underlying profit margin to 49%, even with our previously guided investment in the Group's software development and IT infrastructure. We continue to deliver strong cash flows and have a debt free balance sheet, and we've declared a total dividend of 10.4p per share for the financial year 2024. At this point, I'm going to hand over to Ewan. Speaker 200:02:29Thanks, Alex. Moving to the financials for the period. The top left graph shows average funds under direction, which has grown 11% year on year to £59,600,000,000 at an impressive 11% compound annual growth rate since FY 2020, buoyed by our ongoing strength in net inflows performance and also assisted by positive market movements. Looking across to the top right graph, the growth in our average FUD has translated into revenues of £144,900,000 for FY 'twenty four, an increase of 7% from FY 'twenty three. Our group revenues have continued to grow over the years by a compound annual growth rate of 8%, whilst in parallel, sharing the benefits of scale with our clients, but by providing them with targeted price cuts. Speaker 200:03:22The bottom left graph shows that these record revenues have driven group underlying profit before tax, up 12% to £70,600,000 Underlying profits before tax performance for the year has also been helped by an increase in net interest income and on corporate cash. As displayed on the bottom right graph, the group delivers a consistent dividend, and we have increased the total dividend this year to 10.4p per share. The group has shown underlying EPS 7% growth year over the year at a lower rate than pretax profits due to the full annual impact of the change in U. K. Corporation tax. Speaker 200:04:04Considering group revenue in more depth, we can see in the top graph that platform revenue represents 97% of total group revenue. Growth in average daily FUDs during the period during the year drove increased platform revenues, with our annual charge revenue increasing 9% to £126,100,000 Wrapper fee income increased 4% on the year, and that reflects the increase in open wrappers on the platform and the continued underlying growth of client numbers. These two recurring revenue streams combine to deliver 99% of total platform revenue. Other income continues to reduce as we fully removed by commission midway through FY 'twenty four, following the earlier reduction in FY23. Also note, the group does not generate any revenue from retaining interest on client cash. Speaker 200:04:59As you'll see in the lower half of the slide, Time for Advice has seen healthy growth in the number of license fee paying users, with the corresponding revenue also up 10%. Although total T4A revenue has increased modestly, we're pleased to see that the income from recurring license fees has become a larger proportion of T4A's revenue year on year. Moving on to our administrative expenses for the year. In FY 'twenty four, we managed costs in line with our guidance, and therefore, total underlying administrative expenses rose 11% over the year. Employee costs make up the largest proportion of the overall cost base, and these rose 9% in the year because of Speaker 300:05:422 factors: firstly, an increase in average Speaker 200:05:43staff headcount in the year, firstly, an increase in average staff headcount in the year and secondly, an enhancement of staff salaries to reflect the inflationary environment and to ensure we provide competitive salaries to attract and retain high quality individuals within the business. Other costs increased due to a number of factors, but predominantly due to the increase in irrecoverable VAT and the removal of tax relief due to shareholders from administrative expenses, which we disclosed at the half year. Moving on to Slide 9. We will see the steady moderation of revenue you will see the steady moderation of revenue margin over the years. The platform revenue margin reduced over the last year for two main reasons. Speaker 200:06:29Firstly, because of targeted price reductions consistent with our group pricing strategy. Secondly, due to platform revenue margin moderating marginally as platform FUD grows. This occurs when client portfolio values increase, and therefore, the additional portfolio value can move into lower charging bands. Overall, this demonstrates our standing as a premium platform offering at a competitive price. In the table on your left is the group's liquidity position. Speaker 200:07:02You'll see a surplus of £32,000,000 at the year end after making deductions for regulatory and operational requirements, along with other cash encumbrances. I'm also pleased to say we have approved a 2nd interim dividend of 7.2p per share, resulting Speaker 300:07:19in Speaker 200:07:19a total dividend for the year of 10.4p per share, representing 63% of total underlying profit after tax. Finally, I'll talk you through the group's guidance for the new financial year. I'll talk through revenue first. Consistent with the group's pricing strategy and sharing the benefits of scale with our clients, we will be making 2 targeted price cuts that will take effect in FY 'twenty five. Firstly, the platform will now charge 1 RAPA fee per pension type in family linked portfolios, taking effect from 1st April 2025. Speaker 200:07:57The annualized impact on revenue is expected to be a reduction of around £2,000,000 The second will be a reduction in the charges applied to non advised client portfolios, taking effect from 1st January 2025 at an annualized cost of around £1,000,000 These changes will aid the retention of assets on the platform, including intergenerational wealth planning, whilst ensuring that we continue to attract a strong market share of adviser platform flows. We expect the platform revenue margin to continue to moderate in FY 'twenty five to reflect the impact of these price changes as well as the ongoing marginal impact of revenue margin as platform FUD grows. Moving on to costs. We expect total administrative expenses to increase by 9% in FY 25. This excludes a £2,000,000 one off cost to move to a new London office in 2025. Speaker 200:08:56The cost increase in FY 'twenty five is also driven by the full year impact of the staff headcount increase in FY 'twenty four. Finally, in FY 'twenty six, we expect total administrative expenses to moderate and therefore, to grow by low to mid single digit percentages. And with that, I'll now hand back to Alex. Speaker 100:09:18Thanks, Ewan. In this next section, I'll provide a more in-depth look at how the Transact platforms performed in the financial year. Moving on to Slide 13. Here on the left, you can see how the size of the U. K. Speaker 100:09:31Adviser platform market presents a great opportunity for the group, with U. K. Platform market assets having passed £1,000,000,000,000 for the first time. Of that £1,000,000,000,000 over £680,000,000,000 is currently on U. K. Speaker 100:09:46Adviser platforms. On the right hand side, we see strong projected growth in the U. K. Adviser platform market as illustrated by the estimates provided by the independent provider, Fundscape. As one of the leading platforms in the market, we're well positioned to take advantage of this potential growth, with the current 9% share of the U. Speaker 100:10:09K. Adviser market FUD and approximately 20% share of net inflows. The direction and tailwinds for the adviser platform market remain very positive. During FY 'twenty four, the Transact platform delivered impressive gross and net inflows, including our highest ever grossed inflow in the financial year, demonstrating the platform strength in attracting new business. Focusing on the second half of the year when macroeconomic pressures eased a little, we built strong flows momentum with our net inflows returning to market leading levels, £500,000,000 ahead of the prior year comparison and also ahead of the first half period, which is usually higher due to the inclusion of the tax year end. Speaker 100:10:57Outflows were elevated during the financial year but did moderate during the second half. The solid performance in the second half of the financial year meant that in total for FY 'twenty four, net flows were GBP 2,500,000,000 evidence of the group's high quality of service and advisers' desire to use our leading online functionality. Our award winning service proposition continues to drive growth in client and adviser numbers and remains a key competitive advantage. This year, we were the only platform to improve our Netwealth score. We also won the Schroders Best Large Platform Provider Award as well as the Best Discretionary Investment Manager provider. Speaker 100:11:37We're very pleased with this second award, particularly as the use of discretionary investment managers has become an important tool for advisers as they plan their clients' financial futures. In FY 2024, we continue to grow the numbers of advisers and clients using the platform, and our client retention rate remained strong at 94%. This is net of our periodic closure exercise for low balance portfolios. Moving on to Slide 16. Here on the graph on the left highlights our impressive growth and track record of adding advisers and FUD to the platform over time. Speaker 100:12:12The chart on the right shows the source of growth inflows to the Transact platform. Of particular note, 58% of gross inflows come from established advisers who have used the Transact platform for over a year and who are still adding new clients and their assets to the Transact platform. These strong flows demonstrate the success of the platform digitalization that we have delivered and the quality of service for advice firms and clients. During the financial year, Transact ranked 3rd for gross and net inflows, demonstrating ongoing consistency of flows to the platform. Our market share of net inflows to the adviser platform market remained strong during FY 'twenty four at above 20%, and all of our flows are organic. Speaker 100:12:59The advantage of owning our own proprietary software allows us to maintain our regular update cycle, delivering new functionality and improved efficiency to the platform each month. The decision to further invest in our proprietary software has delivered major enhancements to the platform. 90% of portfolio applications are now opened entirely online. Additionally, 90% of client portfolio records are now updated online directly by firm adviser firm staff. We continue to make progress with the development of operational straight through processing capabilities, with just over 50% of transfers to the platform now being completed without the need for any client service staff involvement. Speaker 100:13:46Our new adviser fee API has seen strong market uptake, with firms managing over £17,000,000,000 of FUD now making use of it. This has resulted in a much smoother automated reconciliation process for advisers and their client payments. These changes have seen significant online adoption and a reduction in manual and paper processes, thereby improving our service and operational efficiency. Looking ahead to the next financial year, we will further develop platform functionality and, as ever, continue to improve service delivery. One area of particular focus is enhanced integrations, helping to increase the speed and ease of data sharing between the Transact platform and the back office systems used by advice firms. Speaker 100:14:35We will also continue the platform digitalization plan. For example, a focus on moving the processes for opening of investment bond wrappers and pension income changes are all to be moved online. And we will continue to expand our digital support to help technical support to help advisers navigate the evolving regulatory environment. Altogether, these developments will maintain our position as a market leading platform, helping attract a greater share of net inflows and keep client retention levels high. We are cognizant of the shift in policy landscape heading into 2025. Speaker 100:15:16The new Labour government presented their autumn budget in late October with the announcement of a couple of key changes to the U. K. Savings environment, both of which we believe will drive the need for financial advice. The Treasury announced an increase in the rates of capital gains tax and also announced that from April 2027, most pension pots will be bought into the scope of inheritance tax where they are not passed on to a spouse. It is expected that both of these changes will encourage clients to freshly engage with financial advisers as clients will need help to navigate the ever more complex savings and retirement environment and to ensure efficient intergenerational transfer of their wealth, savings and investment. Speaker 100:16:03The group's unique offering of proprietary technology allows us to respond quickly to new government legislation and policy changes. And our experienced and high quality technical team are always on hand to guide advisers through these new complexities. These two factors will continue to drive clients and advisers to our platform. Platforms remain the best solution for advisers to manage the long term financial plans of clients, and we remain well positioned to capitalize on this growing demand. As advisers spend more time guiding their clients, the need for a superior client relationship management system increases, helping the demand for T4A's curo advice firm software. Speaker 100:16:48To sum up, our investment case as the leading U. K. Adviser platform remains compelling. We provide an award winning market leading platform, attracting high quality gross and net inflows and have managed to do so in a challenging macroeconomic environment. We've delivered strong financial performance this year with increasing revenue and earnings. Speaker 100:17:10We generate free cash flow efficiently and at a healthy profit margin. And furthermore, we're committed to delivering good customer outcomes and great value for money for clients. And finally, platform digitalization is supporting the group's future growth through enabling operational efficiency and the continuing delivery of flows to the platform. Thank you for your time. We'll now open up to questions. Operator00:17:37Thank you, sir. We'll now take our first question from Ben Baffert from RBC. Please go ahead. Speaker 300:18:12Good morning, everyone. I've got questions in 3 areas, if I may. And off on costs, I wondered about 9% admin expense growth, the 25% that you've guided for today. Could you give some color on how much of that is expected to be driven by headcount growth? Operator00:18:29Or whether or not there any Speaker 300:18:30other factors you could call out as material drivers there? I wondered, are higher rental possibly a factor? And second area is on the competitive environment. You've obviously been able to accumulate market share in 2024. I wondered, is there any anecdotal evidence that forms that might interest the market to suffer any form of recutential damage and perhaps starting to see share with respect to net flows? Speaker 300:19:02And then thirdly, just on the VAT of IAD, I recall back at the time in 2022, you stated you were planning on contesting the HMRC ruling. I know that all the impacts of that change are provided for in your numbers and guidance. But I just wondered if it was still your intention to challenge that ruling, if there's any update on what the time lines might look like for that? Thank you. Speaker 200:19:32Ben, thanks for the questions. I'll take the cost guidance piece and then hand over to Alex for the other 2. So on the 9% cost growth year on year, the main driver of that is actually the actually the annualization of the increase in headcount that we had in FY 'twenty four, plus we're nearly, nearly where we want to be on headcount, but we do see a bit more growth there in the year ahead. From a non staff cost perspective, we are continuing to invest also in our back office infrastructure as well, and that's leading to a little bit more cost in that area. When it comes to the property costs as well, we see this as a one off piece where we've got an overlap in the two leases that we have as we move properties. Speaker 200:20:23So that will subside again as we move into FY 'twenty six, disappearing completely. I'll hand over to Alex on the Speaker 100:20:33other side. Yes, thanks. Yes, On the interest piece, Ben, it's very difficult to be sure whether it's having any reputational damage on people at the moment. I think one of the things that we do expect is now that there seems to be an expectation of interest rates staying up higher for longer, I think that something that a lot of people may have thought would have slipped away from the regulators' radar perhaps won't slip away as quickly as people thought it would if interest rates do continue to stay up because it will continue to be a prominent amount of income for several platforms. I can't say what the regulator is going to do, but I certainly still think that they are still looking at this. Speaker 100:21:25And I'm sure it won't be dropping off their radar at the moment. And then on the VAT issue, we are still challenging. We still have our case actually stayed behind other cases that are going through the VAT tribe, the HMRC tribunal. So we stayed behind Barclays. The Barclays case went through its first findings. Speaker 100:21:56And there is actually an appeal going on at the moment and we are stayed behind that. So we are actually still in sort of communication with HMRC directly and the tribunal. And what we're trying to do here is make sure that we don't get exposed ourselves to any problems if we do not manage to win our position. So we have always paid everything that's due as if we were fully vatable. And we're also trying not to spend a fortune on legal fees. Speaker 100:22:31So at the moment, it makes far more sense for us to stay our case behind the likes of Barclays whilst sort of the decisions on their cases are made. Obviously, the outcome of those cases, we will have to review and consider the actual findings against our own specifics. But at this moment, I'm expecting the Barclays appeal part. And I think HMRC may also appeal the second part of the ruling in that case because there were 2 separate rulings, one effectively in favor of HMRC and one effectively in favor of Barclays. So I'm expecting that appeal to go through, I think, probably within the next 3 to 6 months. Speaker 100:23:20I don't know if there's any more you want to add to that, Ewan, or I missed anything. Speaker 200:23:24I think that's pretty thorough, Alex. Yes. But as Ben, as you've pointed out, there's only potential upside here. And as Alex has said as well, we keep paying our VAT as if we need to. Yes. Speaker 200:23:38Hope that answers the questions, Ben. Speaker 300:23:40Yes, it does. Thanks very much. Operator00:23:44Thank you. We will now move to our next question from Greg Simpson from BNP Paribas Exane. Speaker 400:23:533 on my end. Firstly, just on gross outflows, which have been running at a higher level recently, 10% of opening for this year versus more like 6% to 7% in prior years. What would be your kind of outlook here? What are you kind of hearing about those gross outflows from clients? And also, did you think pensions coming under inheritance tax pushes up the redemptions of pensions? Speaker 400:24:18And then second question would be, if there is no cut to the headline platform fee this year, is it kind of a rule of thumb to think about the natural attrition to yield because of the tiering effect, say, if markets go up by 5%, how much would the commission the platform yields fall by? And then thirdly, can I just ask how much of Transact's platform assets are in kind of passive products now if you have that number? I would be interested to see where IFAs are on that shift? Speaker 100:24:52Okay, Ben. I'll pick up the first and the last one of those. The gross outflows, I mean, they've definitely been elevated. And I think with the environment that I referred to earlier on the interest rate piece, I think we're going to see continue to see outflows being elevated somewhat above the norm for a little while to come yet. And I think whilst we would anticipate that they would drop back, I think we all expect that they will drop back to a newer norm that will be above the old norm. Speaker 100:25:28And part of the reason for that is that where people are taking pension drawdowns, those increases are baked in. And as unfortunately, several people found out when they tried to change their pension positions post expectations of budget outcomes, HMRC is being very clear that these things cannot be unwound on a cooling off position. So they're certainly not going to be able to be changed on other bases. So yes, I think we are expecting that they will come back in time but certainly to a new level. Just picking up on your point on passives. Speaker 100:26:07I mean, from where we sit, I mean, around 85% of our funds are in managed of our FUD is in managed funds. And of those managed funds, if we do a look through basis, about half of that is invested in equities sitting within those funds. I can't really be any more specific than that without digging around a lot as to which you're just tracking and which are sort of more active. But given that a large predominance of our funds are held in pensions, I think it's fair to say that there's a fair expectation that quite a lot of that will be passive. But we can sort of provide a fuller answer to that, which we'll put online. Speaker 100:26:58But I don't have the specifics on passive to hand. Ewan, you can pick up the material point. Yes. I think Speaker 200:27:06on first, what Alex is saying as well, we're obviously an agnostic platform on what our clients invest in. So as long as we're offering those, the full suite of active and passive investments, then it gives our advisers and clients the ability to invest in what they wish. So that's the important point that we want to bring across there as well. On a rule of thumb on platform fees that you asked about as well, I think the important thing is we have a number of stakeholders across as a group, one of which is our clients, one of which is our shareholders. And we look at many stakeholders as we evaluate our pricing. Speaker 200:27:53If you look back at the start of the presentation as well, you see that on average, over the last 5 years, our FUD's grown by approximately 11% per year and also our revenue's grown by approximately 8%. So I take that as a broad rule of thumb on the ongoing moderation of platform revenue margin. I think the second thing to note as well is that we have a long term aspiration to bring down the tiering a little further. We've got we're currently in our lowest tier at 26 basis points for our clients, and that should come down to 25,000,000 in the longer term. And then on the next tier, which is between 600,000 £1,200,000 that's currently at 17 basis points, and we'd like to bring that down again over the long term to 15 basis points. Speaker 300:28:51Really helpful. Thank you. Operator00:29:02Our next question comes from Andrew Watson from Zinger Capital Markets. Speaker 500:29:09A couple from me. The first, could you just give me a sense of the overlap between the chargeable Qrow users and TRANZACT registered advisers? I mean, are there independent users of Qrow there? And is there any intention to eventually embed the general functionality into Transact as an integrated proposition? And then the second one, just on the technology piece. Speaker 500:29:33It's quite evident that there's some more material projects going on in digitalization and API developments. Could you just give me a sense of how long that roadmap lasts? Obviously, alongside the business as usual improvement cycle that you have ongoing. Speaker 100:29:52Thanks, Andrew. Yes, I mean the overlap with the piece on Curo users, transact users is actually relatively small at the moment. Curo is predominantly used by sort of larger consolidating adviser firms. I mean, I think it's an interesting point on sort of the value of FUD that sits on Curo is quite large, but the number of advisers is quite small. And certainly, when you do the relative figures from that back to Transact and the FUD on Transact versus the adviser numbers, they demonstrate quite different markets at the moment. Speaker 100:30:33And that is one of the opportunities that is there in the longer term as we get everything up and into the right place. On your point of sort of Curo being embedded in TRANZACT, whether it's ever actually embedded in all part of the same system, personally, I suspect that won't be the case because if anything, that's not the world. We're not the world is moving away from everything being lumped together to everything being more individual component parts that can then be bolted together as you like them. So we sort of do envisage sort of looking forward a much tighter integration between Curo and TRANZACT. But at the same time, both Curo with other platforms and TRANZACT with other adviser back office systems are also going to need to build those interactions because both products need to be able to play with the other competitors in the market to ensure that we have the broadest marketing platform that we have to be able to attract anyone on board. Speaker 100:31:41But yes, the best solution that is where we wanted to drive everyone on through Curo into Transact and provide sort of the most efficient and cost effective service for everyone through that route. In terms of how long a digitalization program and an integration program lasts and what everyone else is doing in the market and where we sit, I mean, I think it's fair to say that the digitalization piece of our work is probably 80% to 90% of the way through. But that was a sort of relatively, if I dare to put it this way, a relatively easy part of the work to move forward. The integrations piece is much harder. It's a much more complex piece of work. Speaker 100:32:34And it's taking it's not just us. It will take everyone time to do this and to deliver the right outcomes. So sitting here, I'm not going to try and put a number on how long this is. What we have is a staged expectation of when we can deliver parts of this. And it won't be, as with most things that come out of Transat and Integrafin, it won't be a big bang, oh, look, here we are, there's something completely new. Speaker 100:33:00It will be done in stages and gradual so that we manage and maintain our sort of control of the platform. We continue to deliver on platform service 24 hours a day, 3 65 days a year without needing to take the whole thing down for 4 days to replace it with a new one. So our plans will, in some ways, maybe be slowed down a little to make sure that we can do that and continue to deliver in that way. Speaker 500:33:30Okay. Understood. Thank you very much. Operator00:33:34Thank you. It appears there are currently no further questions in the queue. With this, I'd like to hand the call back over to Alex for closing remarks. Over to you, sir. Speaker 100:33:42Well, thank you, Sergey. I mean from my perspective, thank you to everyone for attending this morning. Everything will be online, and we wish you a good day and a happy Christmas.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallIntegraFin H2 202400:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckReport IntegraFin Earnings HeadlinesBerenberg reduce el precio objetivo de Integrafin a 3,80 GBP, mantiene calificación de CompraApril 18, 2025 | es.investing.comBerenberg Bank Cuts IntegraFin (LON:IHP) Price Target to GBX 380April 18, 2025 | americanbankingnews.comTrump Treasure April 19Thanks to President Trump… A $900 investment across5 specific cryptos… Could gain 12,000% so quickly that, just 12 months later…April 26, 2025 | Paradigm Press (Ad)IntegraFin (LON:IHP) Given "Buy" Rating at Shore CapitalApril 17, 2025 | americanbankingnews.comUK’s IntegraFin stock edges up on strong 2Q net flowsApril 15, 2025 | investing.comIntegraFin (IHP)April 10, 2025 | es.investing.comSee More IntegraFin Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like IntegraFin? Sign up for Earnings360's daily newsletter to receive timely earnings updates on IntegraFin and other key companies, straight to your email. Email Address About IntegraFinIntegraFin (LON:IHP) (IntegraFin) is the holding company for all of the entities involved in the provision of the Transact service. Transact is one of the largest independent wrap platforms in the UK. It offers advisory professionals a comprehensive financial planning infrastructure for investing client assets in a tax-efficient way.View IntegraFin ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Markets Think Robinhood Earnings Could Send the Stock UpIs the Floor in for Lam Research After Bullish Earnings?Market Anticipation Builds: Joby Stock Climbs Ahead of EarningsIs Intuitive Surgical a Buy After Volatile Reaction to Earnings?Seismic Shift at Intel: Massive Layoffs Precede Crucial EarningsRocket Lab Lands New Contract, Builds Momentum Ahead of EarningsAmazon's Earnings Could Fuel a Rapid Breakout Upcoming Earnings Cadence Design Systems (4/28/2025)Welltower (4/28/2025)Waste Management (4/28/2025)AstraZeneca (4/29/2025)Mondelez International (4/29/2025)PayPal (4/29/2025)Starbucks (4/29/2025)DoorDash (4/29/2025)Honeywell International (4/29/2025)Regeneron Pharmaceuticals (4/29/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. Start Your 30-Day Trial MarketBeat All Access Features Best-in-Class Portfolio Monitoring Get personalized stock ideas. Compare portfolio to indices. Check stock news, ratings, SEC filings, and more. Stock Ideas and Recommendations See daily stock ideas from top analysts. Receive short-term trading ideas from MarketBeat. Identify trending stocks on social media. Advanced Stock Screeners and Research Tools Use our seven stock screeners to find suitable stocks. Stay informed with MarketBeat's real-time news. Export data to Excel for personal analysis. Sign in to your free account to enjoy these benefits In-depth profiles and analysis for 20,000 public companies. Real-time analyst ratings, insider transactions, earnings data, and more. Our daily ratings and market update email newsletter. Sign in to your free account to enjoy all that MarketBeat has to offer. Sign In Create Account Your Email Address: Email Address Required Your Password: Password Required Log In or Sign in with Facebook Sign in with Google Forgot your password? Your Email Address: Please enter your email address. Please enter a valid email address Choose a Password: Please enter your password. Your password must be at least 8 characters long and contain at least 1 number, 1 letter, and 1 special character. Create My Account (Free) or Sign in with Facebook Sign in with Google By creating a free account, you agree to our terms of service. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
There are 6 speakers on the call. Operator00:00:00Good morning, and welcome to IntegraFi's Full Year Results Presentation. The presentation will be followed by the Q and A. I I would now like to hand the call over to Alex Scott, IHP Group's CEO. Please go ahead, sir. Thank you, Sergei. Operator00:00:19Thanks for the Speaker 100:00:20introduction, and good morning, everyone. As you know, I'm Alex Scott. I'm Group CEO of Integrafin. And with me today, I have Johan Martial Arts Group Chief Financial Officer. I'm going to kick off with an overview of highlights from the group's financial year, and then I'll hand over to Ewan to run you through the group's financial performance in the period. Speaker 100:00:40Then I'll give an update on the Transat platform performance and our strategic progress before moving to Q and A. We're very pleased that the Transact platform finished the year with record high levels of funds under direction, FUD, aided by strong net inflows onto the platform of £2,500,000,000 as advisers continue to deepen their trust in our market leading client service and platform functionality. We delivered record year revenues of £144,900,000 helped by the strong growth in daily average FUD during the period. The excellent performance by our staff in delivering our services and our platform functionality have been consistently recognized over the year, with TRANZACT bringing home the Schroders Awards for Best Large Platform and Best Platform for Discretionary Investment Management. Delivering positive client outcomes has always been at the forefront of what we do across the business, and we've continued to pass to clients all of the interest earned on their cash balances. Speaker 100:01:42Our established business model continued to drive growth in FUD clients and advisers over the course of the financial year. Adviser numbers were up 5% and client numbers up 2%, despite us continuing to close very small portfolios during those 12 months. The record levels of Group revenue drove underlying profit before tax up 12% and increased our underlying profit margin to 49%, even with our previously guided investment in the Group's software development and IT infrastructure. We continue to deliver strong cash flows and have a debt free balance sheet, and we've declared a total dividend of 10.4p per share for the financial year 2024. At this point, I'm going to hand over to Ewan. Speaker 200:02:29Thanks, Alex. Moving to the financials for the period. The top left graph shows average funds under direction, which has grown 11% year on year to £59,600,000,000 at an impressive 11% compound annual growth rate since FY 2020, buoyed by our ongoing strength in net inflows performance and also assisted by positive market movements. Looking across to the top right graph, the growth in our average FUD has translated into revenues of £144,900,000 for FY 'twenty four, an increase of 7% from FY 'twenty three. Our group revenues have continued to grow over the years by a compound annual growth rate of 8%, whilst in parallel, sharing the benefits of scale with our clients, but by providing them with targeted price cuts. Speaker 200:03:22The bottom left graph shows that these record revenues have driven group underlying profit before tax, up 12% to £70,600,000 Underlying profits before tax performance for the year has also been helped by an increase in net interest income and on corporate cash. As displayed on the bottom right graph, the group delivers a consistent dividend, and we have increased the total dividend this year to 10.4p per share. The group has shown underlying EPS 7% growth year over the year at a lower rate than pretax profits due to the full annual impact of the change in U. K. Corporation tax. Speaker 200:04:04Considering group revenue in more depth, we can see in the top graph that platform revenue represents 97% of total group revenue. Growth in average daily FUDs during the period during the year drove increased platform revenues, with our annual charge revenue increasing 9% to £126,100,000 Wrapper fee income increased 4% on the year, and that reflects the increase in open wrappers on the platform and the continued underlying growth of client numbers. These two recurring revenue streams combine to deliver 99% of total platform revenue. Other income continues to reduce as we fully removed by commission midway through FY 'twenty four, following the earlier reduction in FY23. Also note, the group does not generate any revenue from retaining interest on client cash. Speaker 200:04:59As you'll see in the lower half of the slide, Time for Advice has seen healthy growth in the number of license fee paying users, with the corresponding revenue also up 10%. Although total T4A revenue has increased modestly, we're pleased to see that the income from recurring license fees has become a larger proportion of T4A's revenue year on year. Moving on to our administrative expenses for the year. In FY 'twenty four, we managed costs in line with our guidance, and therefore, total underlying administrative expenses rose 11% over the year. Employee costs make up the largest proportion of the overall cost base, and these rose 9% in the year because of Speaker 300:05:422 factors: firstly, an increase in average Speaker 200:05:43staff headcount in the year, firstly, an increase in average staff headcount in the year and secondly, an enhancement of staff salaries to reflect the inflationary environment and to ensure we provide competitive salaries to attract and retain high quality individuals within the business. Other costs increased due to a number of factors, but predominantly due to the increase in irrecoverable VAT and the removal of tax relief due to shareholders from administrative expenses, which we disclosed at the half year. Moving on to Slide 9. We will see the steady moderation of revenue you will see the steady moderation of revenue margin over the years. The platform revenue margin reduced over the last year for two main reasons. Speaker 200:06:29Firstly, because of targeted price reductions consistent with our group pricing strategy. Secondly, due to platform revenue margin moderating marginally as platform FUD grows. This occurs when client portfolio values increase, and therefore, the additional portfolio value can move into lower charging bands. Overall, this demonstrates our standing as a premium platform offering at a competitive price. In the table on your left is the group's liquidity position. Speaker 200:07:02You'll see a surplus of £32,000,000 at the year end after making deductions for regulatory and operational requirements, along with other cash encumbrances. I'm also pleased to say we have approved a 2nd interim dividend of 7.2p per share, resulting Speaker 300:07:19in Speaker 200:07:19a total dividend for the year of 10.4p per share, representing 63% of total underlying profit after tax. Finally, I'll talk you through the group's guidance for the new financial year. I'll talk through revenue first. Consistent with the group's pricing strategy and sharing the benefits of scale with our clients, we will be making 2 targeted price cuts that will take effect in FY 'twenty five. Firstly, the platform will now charge 1 RAPA fee per pension type in family linked portfolios, taking effect from 1st April 2025. Speaker 200:07:57The annualized impact on revenue is expected to be a reduction of around £2,000,000 The second will be a reduction in the charges applied to non advised client portfolios, taking effect from 1st January 2025 at an annualized cost of around £1,000,000 These changes will aid the retention of assets on the platform, including intergenerational wealth planning, whilst ensuring that we continue to attract a strong market share of adviser platform flows. We expect the platform revenue margin to continue to moderate in FY 'twenty five to reflect the impact of these price changes as well as the ongoing marginal impact of revenue margin as platform FUD grows. Moving on to costs. We expect total administrative expenses to increase by 9% in FY 25. This excludes a £2,000,000 one off cost to move to a new London office in 2025. Speaker 200:08:56The cost increase in FY 'twenty five is also driven by the full year impact of the staff headcount increase in FY 'twenty four. Finally, in FY 'twenty six, we expect total administrative expenses to moderate and therefore, to grow by low to mid single digit percentages. And with that, I'll now hand back to Alex. Speaker 100:09:18Thanks, Ewan. In this next section, I'll provide a more in-depth look at how the Transact platforms performed in the financial year. Moving on to Slide 13. Here on the left, you can see how the size of the U. K. Speaker 100:09:31Adviser platform market presents a great opportunity for the group, with U. K. Platform market assets having passed £1,000,000,000,000 for the first time. Of that £1,000,000,000,000 over £680,000,000,000 is currently on U. K. Speaker 100:09:46Adviser platforms. On the right hand side, we see strong projected growth in the U. K. Adviser platform market as illustrated by the estimates provided by the independent provider, Fundscape. As one of the leading platforms in the market, we're well positioned to take advantage of this potential growth, with the current 9% share of the U. Speaker 100:10:09K. Adviser market FUD and approximately 20% share of net inflows. The direction and tailwinds for the adviser platform market remain very positive. During FY 'twenty four, the Transact platform delivered impressive gross and net inflows, including our highest ever grossed inflow in the financial year, demonstrating the platform strength in attracting new business. Focusing on the second half of the year when macroeconomic pressures eased a little, we built strong flows momentum with our net inflows returning to market leading levels, £500,000,000 ahead of the prior year comparison and also ahead of the first half period, which is usually higher due to the inclusion of the tax year end. Speaker 100:10:57Outflows were elevated during the financial year but did moderate during the second half. The solid performance in the second half of the financial year meant that in total for FY 'twenty four, net flows were GBP 2,500,000,000 evidence of the group's high quality of service and advisers' desire to use our leading online functionality. Our award winning service proposition continues to drive growth in client and adviser numbers and remains a key competitive advantage. This year, we were the only platform to improve our Netwealth score. We also won the Schroders Best Large Platform Provider Award as well as the Best Discretionary Investment Manager provider. Speaker 100:11:37We're very pleased with this second award, particularly as the use of discretionary investment managers has become an important tool for advisers as they plan their clients' financial futures. In FY 2024, we continue to grow the numbers of advisers and clients using the platform, and our client retention rate remained strong at 94%. This is net of our periodic closure exercise for low balance portfolios. Moving on to Slide 16. Here on the graph on the left highlights our impressive growth and track record of adding advisers and FUD to the platform over time. Speaker 100:12:12The chart on the right shows the source of growth inflows to the Transact platform. Of particular note, 58% of gross inflows come from established advisers who have used the Transact platform for over a year and who are still adding new clients and their assets to the Transact platform. These strong flows demonstrate the success of the platform digitalization that we have delivered and the quality of service for advice firms and clients. During the financial year, Transact ranked 3rd for gross and net inflows, demonstrating ongoing consistency of flows to the platform. Our market share of net inflows to the adviser platform market remained strong during FY 'twenty four at above 20%, and all of our flows are organic. Speaker 100:12:59The advantage of owning our own proprietary software allows us to maintain our regular update cycle, delivering new functionality and improved efficiency to the platform each month. The decision to further invest in our proprietary software has delivered major enhancements to the platform. 90% of portfolio applications are now opened entirely online. Additionally, 90% of client portfolio records are now updated online directly by firm adviser firm staff. We continue to make progress with the development of operational straight through processing capabilities, with just over 50% of transfers to the platform now being completed without the need for any client service staff involvement. Speaker 100:13:46Our new adviser fee API has seen strong market uptake, with firms managing over £17,000,000,000 of FUD now making use of it. This has resulted in a much smoother automated reconciliation process for advisers and their client payments. These changes have seen significant online adoption and a reduction in manual and paper processes, thereby improving our service and operational efficiency. Looking ahead to the next financial year, we will further develop platform functionality and, as ever, continue to improve service delivery. One area of particular focus is enhanced integrations, helping to increase the speed and ease of data sharing between the Transact platform and the back office systems used by advice firms. Speaker 100:14:35We will also continue the platform digitalization plan. For example, a focus on moving the processes for opening of investment bond wrappers and pension income changes are all to be moved online. And we will continue to expand our digital support to help technical support to help advisers navigate the evolving regulatory environment. Altogether, these developments will maintain our position as a market leading platform, helping attract a greater share of net inflows and keep client retention levels high. We are cognizant of the shift in policy landscape heading into 2025. Speaker 100:15:16The new Labour government presented their autumn budget in late October with the announcement of a couple of key changes to the U. K. Savings environment, both of which we believe will drive the need for financial advice. The Treasury announced an increase in the rates of capital gains tax and also announced that from April 2027, most pension pots will be bought into the scope of inheritance tax where they are not passed on to a spouse. It is expected that both of these changes will encourage clients to freshly engage with financial advisers as clients will need help to navigate the ever more complex savings and retirement environment and to ensure efficient intergenerational transfer of their wealth, savings and investment. Speaker 100:16:03The group's unique offering of proprietary technology allows us to respond quickly to new government legislation and policy changes. And our experienced and high quality technical team are always on hand to guide advisers through these new complexities. These two factors will continue to drive clients and advisers to our platform. Platforms remain the best solution for advisers to manage the long term financial plans of clients, and we remain well positioned to capitalize on this growing demand. As advisers spend more time guiding their clients, the need for a superior client relationship management system increases, helping the demand for T4A's curo advice firm software. Speaker 100:16:48To sum up, our investment case as the leading U. K. Adviser platform remains compelling. We provide an award winning market leading platform, attracting high quality gross and net inflows and have managed to do so in a challenging macroeconomic environment. We've delivered strong financial performance this year with increasing revenue and earnings. Speaker 100:17:10We generate free cash flow efficiently and at a healthy profit margin. And furthermore, we're committed to delivering good customer outcomes and great value for money for clients. And finally, platform digitalization is supporting the group's future growth through enabling operational efficiency and the continuing delivery of flows to the platform. Thank you for your time. We'll now open up to questions. Operator00:17:37Thank you, sir. We'll now take our first question from Ben Baffert from RBC. Please go ahead. Speaker 300:18:12Good morning, everyone. I've got questions in 3 areas, if I may. And off on costs, I wondered about 9% admin expense growth, the 25% that you've guided for today. Could you give some color on how much of that is expected to be driven by headcount growth? Operator00:18:29Or whether or not there any Speaker 300:18:30other factors you could call out as material drivers there? I wondered, are higher rental possibly a factor? And second area is on the competitive environment. You've obviously been able to accumulate market share in 2024. I wondered, is there any anecdotal evidence that forms that might interest the market to suffer any form of recutential damage and perhaps starting to see share with respect to net flows? Speaker 300:19:02And then thirdly, just on the VAT of IAD, I recall back at the time in 2022, you stated you were planning on contesting the HMRC ruling. I know that all the impacts of that change are provided for in your numbers and guidance. But I just wondered if it was still your intention to challenge that ruling, if there's any update on what the time lines might look like for that? Thank you. Speaker 200:19:32Ben, thanks for the questions. I'll take the cost guidance piece and then hand over to Alex for the other 2. So on the 9% cost growth year on year, the main driver of that is actually the actually the annualization of the increase in headcount that we had in FY 'twenty four, plus we're nearly, nearly where we want to be on headcount, but we do see a bit more growth there in the year ahead. From a non staff cost perspective, we are continuing to invest also in our back office infrastructure as well, and that's leading to a little bit more cost in that area. When it comes to the property costs as well, we see this as a one off piece where we've got an overlap in the two leases that we have as we move properties. Speaker 200:20:23So that will subside again as we move into FY 'twenty six, disappearing completely. I'll hand over to Alex on the Speaker 100:20:33other side. Yes, thanks. Yes, On the interest piece, Ben, it's very difficult to be sure whether it's having any reputational damage on people at the moment. I think one of the things that we do expect is now that there seems to be an expectation of interest rates staying up higher for longer, I think that something that a lot of people may have thought would have slipped away from the regulators' radar perhaps won't slip away as quickly as people thought it would if interest rates do continue to stay up because it will continue to be a prominent amount of income for several platforms. I can't say what the regulator is going to do, but I certainly still think that they are still looking at this. Speaker 100:21:25And I'm sure it won't be dropping off their radar at the moment. And then on the VAT issue, we are still challenging. We still have our case actually stayed behind other cases that are going through the VAT tribe, the HMRC tribunal. So we stayed behind Barclays. The Barclays case went through its first findings. Speaker 100:21:56And there is actually an appeal going on at the moment and we are stayed behind that. So we are actually still in sort of communication with HMRC directly and the tribunal. And what we're trying to do here is make sure that we don't get exposed ourselves to any problems if we do not manage to win our position. So we have always paid everything that's due as if we were fully vatable. And we're also trying not to spend a fortune on legal fees. Speaker 100:22:31So at the moment, it makes far more sense for us to stay our case behind the likes of Barclays whilst sort of the decisions on their cases are made. Obviously, the outcome of those cases, we will have to review and consider the actual findings against our own specifics. But at this moment, I'm expecting the Barclays appeal part. And I think HMRC may also appeal the second part of the ruling in that case because there were 2 separate rulings, one effectively in favor of HMRC and one effectively in favor of Barclays. So I'm expecting that appeal to go through, I think, probably within the next 3 to 6 months. Speaker 100:23:20I don't know if there's any more you want to add to that, Ewan, or I missed anything. Speaker 200:23:24I think that's pretty thorough, Alex. Yes. But as Ben, as you've pointed out, there's only potential upside here. And as Alex has said as well, we keep paying our VAT as if we need to. Yes. Speaker 200:23:38Hope that answers the questions, Ben. Speaker 300:23:40Yes, it does. Thanks very much. Operator00:23:44Thank you. We will now move to our next question from Greg Simpson from BNP Paribas Exane. Speaker 400:23:533 on my end. Firstly, just on gross outflows, which have been running at a higher level recently, 10% of opening for this year versus more like 6% to 7% in prior years. What would be your kind of outlook here? What are you kind of hearing about those gross outflows from clients? And also, did you think pensions coming under inheritance tax pushes up the redemptions of pensions? Speaker 400:24:18And then second question would be, if there is no cut to the headline platform fee this year, is it kind of a rule of thumb to think about the natural attrition to yield because of the tiering effect, say, if markets go up by 5%, how much would the commission the platform yields fall by? And then thirdly, can I just ask how much of Transact's platform assets are in kind of passive products now if you have that number? I would be interested to see where IFAs are on that shift? Speaker 100:24:52Okay, Ben. I'll pick up the first and the last one of those. The gross outflows, I mean, they've definitely been elevated. And I think with the environment that I referred to earlier on the interest rate piece, I think we're going to see continue to see outflows being elevated somewhat above the norm for a little while to come yet. And I think whilst we would anticipate that they would drop back, I think we all expect that they will drop back to a newer norm that will be above the old norm. Speaker 100:25:28And part of the reason for that is that where people are taking pension drawdowns, those increases are baked in. And as unfortunately, several people found out when they tried to change their pension positions post expectations of budget outcomes, HMRC is being very clear that these things cannot be unwound on a cooling off position. So they're certainly not going to be able to be changed on other bases. So yes, I think we are expecting that they will come back in time but certainly to a new level. Just picking up on your point on passives. Speaker 100:26:07I mean, from where we sit, I mean, around 85% of our funds are in managed of our FUD is in managed funds. And of those managed funds, if we do a look through basis, about half of that is invested in equities sitting within those funds. I can't really be any more specific than that without digging around a lot as to which you're just tracking and which are sort of more active. But given that a large predominance of our funds are held in pensions, I think it's fair to say that there's a fair expectation that quite a lot of that will be passive. But we can sort of provide a fuller answer to that, which we'll put online. Speaker 100:26:58But I don't have the specifics on passive to hand. Ewan, you can pick up the material point. Yes. I think Speaker 200:27:06on first, what Alex is saying as well, we're obviously an agnostic platform on what our clients invest in. So as long as we're offering those, the full suite of active and passive investments, then it gives our advisers and clients the ability to invest in what they wish. So that's the important point that we want to bring across there as well. On a rule of thumb on platform fees that you asked about as well, I think the important thing is we have a number of stakeholders across as a group, one of which is our clients, one of which is our shareholders. And we look at many stakeholders as we evaluate our pricing. Speaker 200:27:53If you look back at the start of the presentation as well, you see that on average, over the last 5 years, our FUD's grown by approximately 11% per year and also our revenue's grown by approximately 8%. So I take that as a broad rule of thumb on the ongoing moderation of platform revenue margin. I think the second thing to note as well is that we have a long term aspiration to bring down the tiering a little further. We've got we're currently in our lowest tier at 26 basis points for our clients, and that should come down to 25,000,000 in the longer term. And then on the next tier, which is between 600,000 £1,200,000 that's currently at 17 basis points, and we'd like to bring that down again over the long term to 15 basis points. Speaker 300:28:51Really helpful. Thank you. Operator00:29:02Our next question comes from Andrew Watson from Zinger Capital Markets. Speaker 500:29:09A couple from me. The first, could you just give me a sense of the overlap between the chargeable Qrow users and TRANZACT registered advisers? I mean, are there independent users of Qrow there? And is there any intention to eventually embed the general functionality into Transact as an integrated proposition? And then the second one, just on the technology piece. Speaker 500:29:33It's quite evident that there's some more material projects going on in digitalization and API developments. Could you just give me a sense of how long that roadmap lasts? Obviously, alongside the business as usual improvement cycle that you have ongoing. Speaker 100:29:52Thanks, Andrew. Yes, I mean the overlap with the piece on Curo users, transact users is actually relatively small at the moment. Curo is predominantly used by sort of larger consolidating adviser firms. I mean, I think it's an interesting point on sort of the value of FUD that sits on Curo is quite large, but the number of advisers is quite small. And certainly, when you do the relative figures from that back to Transact and the FUD on Transact versus the adviser numbers, they demonstrate quite different markets at the moment. Speaker 100:30:33And that is one of the opportunities that is there in the longer term as we get everything up and into the right place. On your point of sort of Curo being embedded in TRANZACT, whether it's ever actually embedded in all part of the same system, personally, I suspect that won't be the case because if anything, that's not the world. We're not the world is moving away from everything being lumped together to everything being more individual component parts that can then be bolted together as you like them. So we sort of do envisage sort of looking forward a much tighter integration between Curo and TRANZACT. But at the same time, both Curo with other platforms and TRANZACT with other adviser back office systems are also going to need to build those interactions because both products need to be able to play with the other competitors in the market to ensure that we have the broadest marketing platform that we have to be able to attract anyone on board. Speaker 100:31:41But yes, the best solution that is where we wanted to drive everyone on through Curo into Transact and provide sort of the most efficient and cost effective service for everyone through that route. In terms of how long a digitalization program and an integration program lasts and what everyone else is doing in the market and where we sit, I mean, I think it's fair to say that the digitalization piece of our work is probably 80% to 90% of the way through. But that was a sort of relatively, if I dare to put it this way, a relatively easy part of the work to move forward. The integrations piece is much harder. It's a much more complex piece of work. Speaker 100:32:34And it's taking it's not just us. It will take everyone time to do this and to deliver the right outcomes. So sitting here, I'm not going to try and put a number on how long this is. What we have is a staged expectation of when we can deliver parts of this. And it won't be, as with most things that come out of Transat and Integrafin, it won't be a big bang, oh, look, here we are, there's something completely new. Speaker 100:33:00It will be done in stages and gradual so that we manage and maintain our sort of control of the platform. We continue to deliver on platform service 24 hours a day, 3 65 days a year without needing to take the whole thing down for 4 days to replace it with a new one. So our plans will, in some ways, maybe be slowed down a little to make sure that we can do that and continue to deliver in that way. Speaker 500:33:30Okay. Understood. Thank you very much. Operator00:33:34Thank you. It appears there are currently no further questions in the queue. With this, I'd like to hand the call back over to Alex for closing remarks. Over to you, sir. Speaker 100:33:42Well, thank you, Sergey. I mean from my perspective, thank you to everyone for attending this morning. Everything will be online, and we wish you a good day and a happy Christmas.Read morePowered by