Elixirr International plc

Good afternoon and welcome to the Elixir International plc investor presentation. Throughout this recorded presentation investors will be in a ceremony mode. Questions are encouraged and can be submitted at any time via the Q&A tab situated on the right hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself however the company can review all questions submitted today and publish responses as appropriate to do so. Before we begin I'd like to submit the following poll. I'd now like to hand you over to Stephen Newton, CEO. Good afternoon sir.

Good afternoon everyone and thank you for taking the time to listen to our presentation today. I think you probably have seen at the beginning of the week we had some very exciting results and an announcement around an acquisition and this is off the back of obviously our move to main market which was 1st of July. So it's been a very exciting half for us. We've been pretty busy with all of those things and it's all been coming together very nicely. So if you look at what we've had to take you through today is a little bit of an introduction from me then I'm going to hand over to Nick who will cover our financials for you in a bit more detail and then Graham and Em will sort of bounce between the business review and then I'll come back to me and I'll talk to you all about how we see the future and how bullish we are about our positioning in that marketplace so let's talk about the introduction as I said we've had a fantastic half our results are brilliant we managed to move to the main market and now we've also announced the TRC acquisition we've got all our main levers are working really well we've got the organic growth happening we've got the inorganic growth happening and we've got the performance in the market and our profitability happening too so we're all very encouraged to be getting more diversification in the business which is making us more resilient if you look at our business as we were in at the start of our IPO journey on to AIM versus now we've got so much more resilience in this business we've got so much industry diversification capability diversification and also geography diversification we've got obviously four I think five of our last all five of our last acquisitions have been in the US so this has meant we've got a very strong positioning in the US so our geography diversification is working really well and the team are simply performing simply brilliantly the entrepreneurial packages we have for our partners and then embracing those packages as well as the flow down we have for that into the employee pool is really meaning that our people turn up as real owners and it makes a difference when you're doing a silver service or a white glove service like we do at the top end of the market. in consulting. So our clients love the way our people turn up every day. They're very ambitious, motivated people who like to deliver real value to their customers and I think it's showing in the marketplace and hence we're gaining market share. Looking at some of the numbers you can see that our revenue is up 35% and what's particularly pleasing obviously is organic growth revenue there of 17%. As I've said many times we like to have organic and inorganic working together if you like to kind of deliver on an overall growth objective of around 30% year on year which we've achieved since actually 2012 but since IPO as well so the reason we think the range of 10 to 20% on organic is a good range is that if you think about a business which is growing in say the top end of that range 20% plus you've got a natural attrition and consulting of somewhere between 10 and 15% You actually have to hire 35% of your workforce every year if you go beyond the 20% organic growth number and in doing so you will be changing the quality standards, the cultural integration standards and it's actually almost too much to swallow. So the natural growth rate of a consulting firm that's doing really well organically is somewhere between the 10 to 20% range. And we've been doing that consistently, so very proud of that. And then you couple it with Graham's inorganic strategy, which he can talk to you about the TOC acquisition in a little bit more detail. If you couple that 10% to 20% that we would look to buy in the same model, you get the averaging out at 30% to 35%. And, of course, we've been consistent with that, and we will continue with that as it's proving a very successful strategy for us, let's say. And what's also particularly important here is you can see that we've gone from, I think the number there is 31 new gold clients, or gold clients this year, up from 22 last year, which means that the depth of our relationships with our clients is expanding. And it goes alongside the acquisition strategy. As we get more capabilities, we can sell more capabilities to our clients. And that means that we have deeper relationships, touching more buying centers, making more impact, delivering more value. so this is all very good and in addition we're obviously acquiring a whole bunch of new clients and we had a fantastic quarter as I said we had five of those months were record months if you look at other angles to this obviously our brand is being developed it's I think in the UK now we're known by everybody in the industry there wouldn't be a player in the UK industry who wouldn't have heard of us by now not quite the case in the US but it's getting much much better we've got some fantastic awards Forbes giving us the best consultancy award there and actually for our US business they gave us the best AI consultancy too so we're getting some fantastic recognition and that's helping build our brand and we start to see inbound client requests as a result which is fantastic and then the other two things I touched on the TLC acquisition that we've just done Graham will go into that in a bit more detail for you but it's a really really exciting top of the house company that is considered by their clients as a mini bang and believe they are better than MBBs of the world so this really rounds out our strategic capability you know it's almost the end of their projects that they do with their clients is almost the starting brief for our execution opportunity and this is exactly what TRC have seen with their ambition and interest to join our group we're getting six fantastic partners all of whom have worked together at Maricon all of whom are a really well formed team and we had them a long time apart quarterly and they were certainly almost felt like they had been with us for years and years so it was a fantastic thing to see and you know I'll touch on this now but Insignium who we acquired in October of 2023 are sort of the cultural end of strategic change and their relationships are all top of the house and in this half we've sold 10 million pounds of elixir consulting services into their relationships which we would never have had access to if we hadn't bought Insignium and the thing about plc is that they're almost well they are exactly in the same situation they have top of house relationships and most of them american head office businesses that allow us to really start growing our other consulting services into these businesses and to give the Insignium Commons some perspective Insignium's own revenue is 9 million so what we've taken is we've taken a single relationship and essentially across the board doubled the value of the relationship to our business and our shareholders which which we believe is at the heart of our strategy and and it's just coming to life and the TLC acquisition is is yet another fantastic opportunity for us to do this I think it's probably going to be our biggest opportunity in the space so I'm really excited about that acquisition and then I'll just round off by talking about our talents clearly you've on the organic side to grow our firm organically we have to promote and hire partners and we brought in a number of partners promoted three brought in two and I'll just touch on one because I'll just tee up Emma a little bit later she talks about AI we brought in Conrad Troy from Deloitte who ran the global SAP business there and Conrad's particularly excited about joining us because he was so stifled in Deloitte being unable to essentially use the AI type technologies to really transform the way SAP is handled by clients and you know he is frustrated by that but on the CEO and most of the leadership team that was so excited about the potential of working with a disruptive consultancy like ourselves to really disrupt what is a massive revenue earner for the big firms and they have almost no motivation to go off to those kinds of opportunities because there are turkeys voting for Christmas in that instance so fantastic opportunity there diversifying our capabilities also not only through acquisitions but through strategic hires like that and you know we're looking for team hires in the similar context and then finally just to say to see the participation of our employees in our employee share purchase scheme you know they turn up every day as owners and and it makes such a real difference to the way they turn up on our clients and And I think you see that the performance is flowing through to our financials, which is the ultimate measure of performance in this context. Just a couple of things on the market I'd like to make a comment on just before I hand over to Nick, who will continue with the finance side of the business, the financials in a bit more detail. This industry is a growing industry. I've been in it for over 35 years, a couple of startups in between, and then obviously this business. In every year, the industry is growing. and then we'll show you later that AI is growing fastest by a long way but in every sector you'll see growth and it's been like that for 30 years through dot-com bubbles bursting through 2009 recession you name it the consulting industry is just the juggernaut that keeps on growing and it's quite obvious when you stand back and think about it because you know business is getting more and more complicated not less and less complicated and with the introduction of things like AI and if you make things more complicated people need more advice and they need expertise in areas where they don't have expertise so you know the things you see in the FT with you know 2,000 people being ladled for Accenture or KPMG or McKinsey or you name it these are these brands just using never wasting a good crisis right they're using the banner of market turbulence for their customers as a way to prune and eradicate the underperformance in their business it's almost certain if you go look at extensive figures their profits not going down if you go look at I mean they've got a different challenge actually because of the whole AI challenge around technology but the consulting businesses are still growing continuously and the KPMGs and PWCs they don't pay their partners any less they keep paying them more so you know it's an industry that keeps on growing and we're excited to be able to present an opportunity to shareholders to invest in this industry because if you take these comparators none of them are actually directly comparable to us even though we outperform all of them none of them are directly comparable to us only one that's perhaps the closest is Booz Allen and Booz is listed in Chicago but the difference between Booz and ourselves they're almost exclusively I think it's about 85 90 percent government sector and we're exclusively private we refuse to work in government because it's a race to the bottom on price and that's the real difference. So there's no real public sector strategic consulting firm that's out there. Accenture, FRP, IBM are completely different businesses really. Accenture is SI outsourcing, systems integration and outsourcing, IBM is product and outsourcing and FRP is, albeit in services, in the different services around restructuring and things like that, which is not true consulting. well it is consulting but it's not the type of consulting we do so it's not directly comparable so we're very proud of our performance vis-a-vis others very proud of our performance vis-a-vis our team's performance our own individual acquisition performance but also we're in an industry that is getting more and more exciting I mean I was around when I did a dot com startup around 2000 and you know the hype back then was almost like you see it around AI it's actually laughable to see the same thing unfolding and people making the same mistakes like the high street is going to be dead right no one's going to buy anything through a physical channel anymore everyone's going to buy everything through digital the truth is things are bought through digital but it's just a different way of buying you have to complement the relationship between the physical presence and an online presence and today We're still teaching people how to use digital to make your businesses more efficient and to get more revenue through that channel. And AI is just that gift that's going to carry on giving. That is the opportunity, and Em can go into this for you in a little bit more detail.

I've spoken enough.