RWS Holdings plc

Good morning, everybody, and welcome to the half-year results of RWS. As you know, we try to avoid financial surprises, and this presentation contains, as far as I'm aware, no financial surprises, and very much in line with the extended trading update we gave you in April. However, of course, there is the obvious surprise of the change in CEO, which you may or may not want to talk about at the end of our presentation. So the merger with SDL has delivered the world's leading provider of technology and technology-enabled language content and IP services. We have over 7,500 employees spread across the world, and you can see on the map where they're basically positioned. We have rather more offices than we currently need, and that's part of the integration process is we're reducing some of those offices. But as a result of becoming the largest in the world, we have a fantastic customer spread. We have advanced our position. We were probably somewhat lagging behind in life sciences in the number two position. We think we're probably up there with the number one now. And we have by far the strongest financial profile within the language industry. And you'll see more of that as we go through the financial presentation. The first half has been described as robust. I think it's important for you to remember that H1-20 had one month effect from COVID and H1-21, of course, had the full six months and a degree of FX headwinds, which of course have not abated as we've moved on into H2. The effect of COVID is largely been focused on our IP services business. But it extends to any client who sees the need to reduce their requirements for languages because of the working from home phenomenon. So looking at the summary of our first half, 326 million in revenues. That includes five months of SDL. adjusted pvt of 50.5 million basic eps adjusted 10.5 up 12 leading to a proposed final dividend of 2p which is up 14 and that's underpinned by a strong balance sheet and the board's confidence in delivering the full year that you guys have built into your models Gross cash at March 31, 62.2 million. That's after the heavy half year when we pay our full dividend out. So 52.2 million of debt interest acquisition and dividend payments. So a pretty strong, as usual, highly cash generative delivery. And net cash, 12 million. So we have turned around from net debt to net cash. We expect that to continue certainly for H2. At this moment in time, we have no major acquisitions scheduled for the next four months. It's been a transformational period, as you can imagine. I referred in April to the fact that this will become a business school study at some stage, that you can take on a business, double your size and more than double your size in people and still not have been actively in their offices because of COVID and the working from home phenomenon. The former SDL integration is progressing well, and you'll see from Des the financial effects, and Richard will take you through the operational integration. But we have identified 33 million of synergies, which I'm afraid analysts always take synergies to be day one. In this case, they are definitely not day one synergies. There were a number of day one synergies. But we think 15, 16 million will be booked in financial year 21, and we'll be at north of 33 million by September 22. As a result of the combination, as I think you now well know, are the leaders in the world in our space. Of the now four divisions, the one that was dragging its feet slightly was the IP services business. You need to take a line there between 18, 19, 20, 21. We misled everybody because we enjoyed a fantastic 19 without realizing there was a one-off effect emanating from the European Patent Office, which was not repeated in 20 and not repeated in 21. We do hope that sometime, maybe before the end of financial year 21, but certainly early 22, there will be a one-off effect as the EPO gets back up to speed. But they have definitely been much slower and been giving their staff extra holidays. So that works its way through into our results because we don't do anything until the EPO has granted a patent. In the regulated industries, which is where the former life sciences business of RWS now finds itself, we have had a strong performance from the old life sciences business. And we see good prospects in the integration of former SDL in improving the margins that were generated, particularly by the business they bought in 19, Donnelly. And in language services, so the biggest of our divisions, the former Moravia that you will remember has had a good half year. as have the SDL C&E, although, of course, they experienced more impact from COVID-19 than the old Moravia business did. And in language and content technology, strong H1 performance, and there we've seen some interesting wins. So it's been a busy, transformational half year. And I'm going to hand over to Des now to take you through the numbers that come out of that.

Thanks, Andrew. First thing to note here on slide six, where we are now, is the transformative impact of the SDL acquisition on our financials. So I'll make sure to unpack the various components here to highlight both the like-for-like impact of the acquisition on our numbers alongside constant currency impact, as this will give a more accurate measure of the underlying performance across our new divisional structure. That in mind, let's move on. Headline revenues of 326.4 million. That represents an increase of 92% on last year's results. A like-for-like basis by adding in the relevant five-month pre-act revenues of SDL and then our two smaller acquisitions in H2 of last year, WebDunia and Iconic. we can see that like-for-like revenues are effectively in line with prior, but have been impacted by an unfavorable FX headwind. On an underlying constant currency basis, revenues have, in fact, increased by 3%. Gross margin. Gross margins increased from 38.8% to 44.9%. A couple of things at play here, but the main driver is clearly the addition of the higher gross margin SDL revenue base, which historically has been around 52%, on top of the former RWS gross profit, where gross margins, as you know, have been close to 40%. So on a like-for-like basis, gross margins are aligned with the relative change in gross profit mix, but have been impacted by FX again. On a constant currency basis, gross margins strengthened this period by 80 basis points, And this primarily reflects an increase in stronger GM in the IP services division as a result of their right size in the business earlier this year in response to last year's drop in revenues. Admin expenses and percentage of revenue have increased from 18% last year to 29% in the current year. Again, the main driver here is the acquisition of SDL. SDL had up X's percentage of revenue in the low 40s, while standalone RWS was between 18-19% year on year. It's worth pointing out that in addition to this, OPEX costs a benefit from the realisation of over 5 million in synergies within the first half of this year. And as Andrew said, on a gross basis, we'd expect that to be around 15, 16 million for the full year. Net finance costs have increased slightly, 1.7 million, but this masks the fact that our underlying interest costs has continued to fall in line with our debt repayment schedule, but has been offset by additional IFRS 16 lease interest expense following the acquisition of STL of roughly 700K. Brings us to adjusted PBT, which at 15.5 million is 53% last year at a net margin of 15.5%. That's down from the 19.5% of last year. Of course, this primarily reflects the dilutive impact of the lower net margin SDL business acquired. Also worth pointing out, the increase in adjusting items this period, the two main increases here are acquisition expenses of 10.6 million, so from just 0.2 last year, and primarily reflects costs related to the SDL acquisition, along with the incremental integration costs, which we're encouraged to realise are planned synergies. That's about 6 million. In terms of tax, adjusted effective tax rate increased to 23.4%. I think we signposted that at the trading update. That's up from 22.4% and is due to a greater proportion of taxable profits former SDL business which were exposed to higher corporation tax regimes. And we'll finish this slide by looking at EPS. Basic EPS has decreased by 42% to 4.2 pence. The course that's been impacted significantly by the large adjusting items this period. Once you adjust for these, we see that the adjusted basic EPS has actually increased from 9.4 pence to 10.5 pence. That is a 12% increase of a comparative period. okay moving on uh next slide breaks down revenues into new divisional structure this slide provides a bridge between the headline reported revenues and the underlying revenues of the group split out in line with the new divisional structure of the client group the main headline here is that although like-for-like revenues are in line this year they've suffered from a seven and a half million fx headwind which when we add back in results in a three percent increase in the online group revenues so moving from left to right we start with the h120 reported revenues of 169.7 million to which we need to adjust for pre-acquisition revenues, which total $155.5 million, $150 million of which relates to SDR. And that leaves us with a like-for-like revenue number of $325.2 million. We then add back in the constant currency revenue increases by division. In H1, the regulated industries division led the way, with underlying revenues increasing by $6 million. That's an increase of 9%. Worth noting here that we had a strong performance from both the former RWS life sciences division, which increased by over 10%, and former SDL regulated industries division, which was up by 8%. Language services was also up by 2 million. That represents an increase of 1%. Again, there's a mix here. The increase was mainly due to a 3% increase in former Moravia, offset by a 1% decrease in the former SDL commercial enterprise revenues. IP services down by 2%. But it's very important to point out here that there's renewed momentum in the IP services division and revenues are actually, in fact, up by 4% from the second half of 2020. Also encouraging is the performance language and content technology division, where underlying revenues have increased by 4%, this largely as a result of the content technology side of this division. So from underlying revenues of $333.9 to get to reported revenue for the year, we need to deduct the FX headwinds in the period of $7.5 million, which came largely as a result of the 5% weakening of the dollar year on year. So it takes us back full circle to the reported revenue figure for this year of $326.4 by $1.2 million on a like-for-like basis and by $8.7 million or 3% on an underlying constant currency basis. That's our summary balance sheet. Just draw your attention to a couple of relevant items here. Intangible assets, so non-current assets here, have increased by $602 million since year end. And this, again, has been driven by the acquisition of SDL in November. This transaction added about $97 million in non-current assets, and there's an additional $523 million currently recorded as goodwill that will break down between intangible assets and goodwill over the coming weeks as we finalize our purchase price allocation exercise. In addition to SDL, it's also increased the networking capital to 77 million. That's an increase of 26 million from the comparative period. And we're also pleased to report continued improvements in our day sales outstanding. That's our DSO metric, and that's across both RWS and SDL, which now stands at 44 days across the combined business. And you may remember, we reported this metric of 46 days at our year-end presentation. So that continued improvement is a testament to the great work of our credit collections team that they've made over the past year. Finally, you'll see that we've moved into a net cash position this half. The closed stage form of net cash, excluding RFRS 16 lease liabilities at 11.8 million. That's a 27 million improvement from the net debt report at year end of 15.1 million and a 46 million increase year on year from the net debt of 34.5 million that we reported at the end of the first half of fiscal 20. finished the fiscal year with cash and cash equivalents to 62.2 million it's up significantly on last year's comp 28.3 million and the 51.4 we reported last september now the net debt cash bridge um it's effectively a proxy for cash flow since the end of september for the first half of the current fiscal year so starting with our opening net debt position 15.1 i'll move quickly left to right across the bridge takes for a net cash position at march 31st of 11.8 mil With operating profit of 25.7 million, you'll see that on the face of the statutory P&L. To that, we've added 21.2 million in non-cash items. That's mainly 14.3 of intangible amortization, but also an additional 5.4 related to IFRS 16 right of use assets, and there's 3 million in additional depreciation. So 20.2 million increase in working cap. That's roughly 9 million increased receivables and 11 in reduced trade and other payables. Again, worth noting here, the reduction in payables relates to acquisition fees accrued on the opening SDL balance sheet and the payments in March of accrued full year F former SDL bonuses for their fiscal 20 period. So that had a major impact on the numbers in this half. see the 55 mil that we inherited from the acquisition of sdl with capex this period of 9.9 million it's five and a half mil of capitalized software developments across the combined group and other general capex of 4.4 million capex is as a potential revenue remains below three percent across the group Tax paid in period is 10 million, it's up from 8.7 in the competitive period. Dividends paid in this period are over 28.2 million compared to 19.3. That reflects the payments of the final dividend back in February and obviously the increased number of shares accruing a dividend as a result of the share of share acquisition of SDL earlier in the period. There's 5.8 of lease payments under IFRS 16 and then finally interest paid at 1.4 million. Compared to 1.3 last year, we covered this earlier, but it reflects the reduced interest costs in our outstanding debt and the offset with the additional aggressive 16 interest payments from SDL. So that brings us back to our fiscal 21H1 position of net cash of 11.8 million. It's a positive movement of 27 million in the first six months of the year. So the final slide in this section is our revised group currency analysis. As we've seen, financial results in this half of the year have been negatively impacted by currency movements, and the acquisition of SDL has significantly added to our dollar surplus across the group. Before March, we had, as you well know, U.S. dollar revenues close to 70%, while over half of SDL's revenues are also denominated in U.S. dollars. That leaves us in excess of 60% in terms of dollars for the combined group. It's worth noting, I guess, the key currency pairs movements in the period. The dollar weakened by 5% against GBP. 8.5% against the euro, while the euro in turn strengthened by 3% against GBP. Well then, given our natural balance between euro revenues and cost division, we can focus more on the dollar surplus in terms of the overall financial impact on the group. Coming into this fiscal period, we're already hedged to the transactional level at RWS. The acquisition of SDL has only added to our US dollar exposure. SDL historically did not engage in a hedging program. So since the beginning of the year, we've taken out significant additional dollar forwards to protect against any further weakening in the dollar rate from a transactional basis. Overall, we've hedged over 50% of the dollar surplus, which covers our transactional requirements. The remaining unhedged translational risk will continue to highlight through constant currency reported, as agreed by the board. The currency flows of the group are evolving. And they become ever more complex with the acquisition of STL, but we'll continue to adapt our overall treasury strategy to mitigate currency exposure across the combined group. It's worth noting one of the options that we're currently evaluating is the viability of moving towards reporting in an underlying functional currency of US dollars, as it better reflects our underlying business. And in the absence of a strategy of stockpiling sterling may well provide the clearest path to reducing the longer term volatility. okay so um yeah just before um hand over to richard um i'd like to take the opportunity actually to thank richard um for all of your support and guidance over the past three years here at rws spent an incredible amount to me personally and yeah so thanks richard and all the best in your next

Oh, geez, Jess, I wasn't expecting that. Thank you. But equally, it's been great working with you. But moving on, warning everybody else. So IP services represents about 17% of the group in this consolidated world with SDL. Sales are down 2% year on year, but it could have been better. You know, and clearly the market has stabilized a little bit with revenue up 4% from H2 FY20. So there is some improvement there. But if you look at the three parts of the business, we've got the research business, which includes our market leading PatBase. That's up 10% with PatBase growing by about 8%, I think it is, despite FX issues. We've got growth in world file in constant currency and GBP is broadly flat, slightly up a little bit. But obviously, there's some growth there, which is good. But as Andrew said, it's in Euro file where we're still struggling. You know, there are some signs that that will improve and we're hoping it will improve. But at the moment, that's certainly struggling. I think on a brighter note, I think Japan is doing extremely well. Japan and local currency are up 14%. helped by additional sales to a very large consumer and electronics business. And also China is up by 9% and that's been helped by wins this period and also a really big win last period that we've previously talked around. So overall, sales are not brilliant, but certainly better than they were and moving in the right direction. The other thing that we should remember is, again, as Andrew pointed out, you know, we do have a full six month worth impact of COVID in this period, whereas we didn't have that last time. So in terms of new wins in the period. It's been more about expanding sales offerings to existing customers rather than new business wins. So it's spreading rather than new wins. There have been some small wins, medium-sized wins, but no real sort of blockbuster names in the period. Cross-selling is looking good. We have a number of opportunities within the cross sales, not just within IP services, but particularly in IP services as the sales teams get access and leads into former SDLs customer base and they're moving forward nicely. So we're very hopeful on that. In terms of the P&L, we've got a slightly stronger gross margin at 43 percent. Overheads were flat. So, in fact, at profit level, we would have shown a good result. However, the FX impact on our U.S. dollar debtors and U.S. bank account meant that the profit actually fell as well. Outlook, well, the pipeline is pretty good. As I say, there's a number of opportunities there that we're currently working on. COVID and the lack of sales travel is making closing those opportunities taking longer than they would normally. But they are moving forward and the opportunities are out there. And we're sure that, particularly in America, once the market opens up even further, we will be winning those opportunities. And the other thing I should say is that the ERP project is moving forward nicely to schedule. And there'll be another 18 months, I think, before we get that in. But it's moving along nicely, not really impacted by integration in any way. It's pretty much a standalone business apart from the cross selling that we just talked about. So if I move then to language content and language technology, this division accounts for 15% of the group's revenue now. And as the name suggests, it's made up of two parts. It's made up of content technology and language technology. And the content technology had a good period. And the content technology is Tridian Docs, Tridian Sites, and also Contenta. And they were up 7%, as I think I just said. And that was driven by some really nice wins in the period on sites. They won a hotel chain award. With Docks, we won a large supplier to the semiconductor industry. We also won some sites with a manufacturer of compressed air vacuum products in Germany, and also US Techco on Docks. So some nice wins, which has driven that part of the business up 7%. On the language technology side, sales there were flat, and it's a mixed result within there. So our machine translation sales, sales of pure machine translations, were up 3%. Our sale of language cloud, which will, over the years, become our flagship product. machine translation offering or just translation offering in general was also up 3%. But our translation management systems were down 8%. And that's partly because of our push to move customers across the language cloud and start selling software as a service rather than perpetual licenses. So that's definitely something we're doing. We've also issued the end of sales notice as we'll come on to in a minute when I talk about integration. We've also issued end of sale notice on a number of products, which is also moving people across to the language cloud offering. And we will see that for a little while to come, yeah. On terms of the pipeline, we have a number of good opportunities there. We've got some aeroplane manufacturers, some lovely opportunities there, and also Japanese car opportunities for sites and docks. So good growth. decent opportunities, nice business. In terms of profit, the gross margin improved to 72% from 71%. Overheads were lower by 3 million, partly COVID-driven, reduced travel, et cetera, et cetera, but also lower headcount, partly through the changes we're making through the integration, but partly just through good housekeeping. And as you can see there, profit was significantly ahead at the bottom right-hand side of the slide. Integration work, what are we doing? We're rationalizing the product range. focusing on language cloud. We currently support over 22 products. As a result of the rationalization, that will reduce significantly. It's going to take us some time to get there because we need to make sure the language cloud is sufficiently good enough. It is good at the moment, but we need to enhance its capabilities so that we can start migrating customers across. So it's going to take some time, but it's certainly work in progress. The other things I should mention are that the iconic business that we bought, the Irish business that we bought last year, is being merged into the language weaver, as we call it now, which is the machine translation business for SDL. That's going ahead really well. No issues there. And we're also, as I said, we just mentioned language weaver. We're also rebranding our products, removing SDL and making them more hardware-based. So if I move on again then to language services, now language services is the biggest part of our group now with 45% of the revenue. And this is a combination of former Moravia and former SDL C&E. And I should have said on language content and language tech, that's very much a standalone. There's no real, apart from small pieces of iconic, there's no real issues there in terms of integration or whatever. So language services, former Moravia and former SDL, Moravia sales were up 4%, 5% in US dollars. So decent growth there. SDL sales were down 2%. So why is that? Well, in Moravia, very strong growth from our top media company. And what they've done is they've widened the range of languages that they want us to translate. And we're also having good progress on the Latte project. Large U.S. consumer electronics company was flat. Large U.S. content production company, large drop. They've decided they've changed their policy and stopped checking the quality of language translations, which has meant they've taken work away from us. But net-net, Moravia has done pretty well. On the SDL side, as I said, the revenue is down 2%. The other impact that SDL saw in the first half results was a large South Korean conglomerate had an Alexa equivalent product, which they canned last year. So all of the translation and development work on that we haven't seen come through. The gross margin for the two businesses, Moravia increased from 34 to 36, which is a mix and volume issue. SDL went from 43 to 40%, which is a volume issue. Overheads, Moravia up 2%, SDL down 6%, which is still higher than they probably should be. But this shows we've made some positive progress. And as you can see on the right-hand side, again, we've made some good progress on the profit improvement as well. In terms of integration, talked about the search company. And I should just say that we're moving that search company over onto SDL because the customer wanted us to. The other large Moravia customers will stay on the Moravia systems and we won't be touching them. But some of the smaller Moravia customers, you know, we will certainly be looking to utilize SDLs and operations and language office and Helix, etc. Pipeline for the business is good. Talked about the content production business growing nicely. And we've also seen some sports manufacturers doing well with the Olympics, etc., So generally, it's moving in the right direction. Regulated industries, 23% of the business consists of former RWS life sciences and former SDL regulated industries. The RWS business was up 9%, 11%, I think it was, in local currency, and SDL was up 3%. If you look at the former RWS business, we've got... our major life sciences customer was up 12 percent our linguistic validation was up nine percent and the rest of the business the life sciences business is up 12 in local currency so really strong performance driven from lots of things and we're certainly seeing some tailwinds from the work we're doing on COVID and we expect to see that going for some time because pharma co-vigilance um which is basically making sure that the or translating documents to make sure the drug is doing what it says it does um and monitoring for any um variations from that expected performance we expect that pharmacovigilance to go on some while this is the first time we've ever done a global vaccination program so the life sciences business is in a good place the former sdl business um growth there of three percent They've had some good wins with law firms. They've had some good wins with banks, etc. And also seen some growth through the uptick in IPOs, etc. And they've seen some work from legal due diligence and also ESG work. They're seeing some benefits from that. So overall, this business has done extremely well. Gross margin, RWS was flat. Former SDL was slightly down. overheads, RWS was up by 10%, and that's because we wanted to spend money improving our IT security. We recognized that that division perhaps wasn't quite where it needed to be compared to the others, so we've tightened that up. In former SDL, it's down by 8%. Again, it's headcount driven as we make changes throughout the organization as part of the integration. And just talking about integration, the org structure is now in place. Teams are integrated, embedding in. Work started to move various clients through onto the SDL language office, so using in-house translators. The Donnelly, because SDL bought Donnelly a couple of years ago, the integration work there is still to be completed. And that's causing us a little bit of a headache because we need to get that done before we can move on with other stuff. outlook for the division is very strong as i just said in terms of sales the challenges we've got is actually manning up and staffing the lockdown and working from home is making it easier for our competitors to poach some of our staff so to address that we're within linguistic validation we've set up a a center in poland um that's recently become operational, which is good. As I said, pipeline's good. I think one of the surprises for us as a business has been the low margin within the former STL business. First half last year, they didn't make any profit at all. So then if I look at top customers, as we say in all our publicity now, I think what we did was it 90 of the top 100 brands and 80 out of the top eight out of the top 10 patent filers or something. I don't know, but that coverage is amazing. Our customer list is staggering to who we sell to. And that's justified because of the organization and the quality of the work that we deliver. so if i move then on to sdl integration board management and team was six million and that's as we restructure and remove duplicate costs sales and marketing was 10 ditto consolidated teams revised sales comps back office was five you know hr finance legal third party three lots of different cost salary savings and audit etc geographic locations uh just one and that's relatively low but that's because we do not include The SDL savings that were previously announced, you know, if you remember back about a year ago, they announced a whole set of office closures. So we haven't included that in there. And then tech is two and then operations is six. So that's what gets you to the 33 as we have it today. And it's going to be an iterative process. There's more to come. We keep pushing on several things. So if I move on to the next slide. As Andrew said, overall, the integration is going well. What we're seeing is much greater sales opportunity through having a wider sales team, wider number of products, wider service range, etc. The cross-sale scheme is in place and is beginning to yield results. a gross margin um opportunities there reducing the complexity within sdl better utilizing the sdl's language delivery office and helix to it to a degree and enhanced relationships with our freelancer community to Better buy operational improvements, remove duplication, streamline and simplify. There is a lot of complication within the SDL business that we just need to get to the real core. Speed up decision making. They're a bit of a beast is SDL. We need to sort of move that forward as fast as we can and get the staff, every level of staff to question every single item that they spend, cost to be benefit on everything. So a bit of a cultural change there. And finally, what we want to do, and it's a great place to end, is be a better place to work for our employees, create better opportunities for them to advance their career, be a fairer workplace. And Andrew will come on and talk to you about some of the things we're doing on ESG. And give employees the opportunity to contribute on events and activities that the group is taking. So I think that's it. So with that, I'll hand over to Andrew. Thank you.

Thank you, Richard. So we all know how important ESG has become and how fast it's become important. So, of course, we have had to react like everybody else. We have appointed a full-time head of ESG and sustainability. What we've really discovered is that ESG has moved forward so fast that the rating agencies don't appear to look very much further than your annual report. So you have to really cram everything into the annual report. And those of you that have taken the trouble to read our 2020 annual report, which of course much fatter than the 2019 report, will see the first signs of that. And I guess the 21 report is going to be substantially bigger. The first thing we've done is to communicate with our key shareholders. So 80% of the shareholders outside of the director holdings have been approached. and have been asked for feedback on what they consider to be important indicators that they're expecting us to measure up to. And we have done similar sort of exercise, although it's not complete yet, with selected clients as opposed to shareholders. RWS activities as a group should position us in the top quartile of ESG ratings. I mean, there are no smokestacks anywhere that I'm aware of. Uh, we operate out of modern offices. Um, yes, we do a fair amount of traveling in pre COVID times. Um, and of course we've got to, um, to engage with our, our employees in terms of the footprint that they are, uh, leaving on the planet. But, um, We think that we are, for our size and our reputation, we are certainly moving up the rankings with all of the outside bodies that investors rely on. Richard and his team have put a lot of effort into the social side, especially on COVID-19. Mental health of our employees and their wellbeing, communication with them has been at a very enhanced level. We're rolling out a new group-wide intranet, as you can see. we are also focused on improving our diversity and inclusion so all of the sort of tick boxes that you would expect us to be focusing on we are indeed focusing on and you will see a considerably enhanced input into our 2021 annual report as i said On the community side, on the next slide, most of you will be aware of the joint venture between myself and RWS in terms of language undergraduates at Manchester. We are now taking 20 students in per year in terms of scholarships to underprivileged but bright linguistic students. Unfortunately, we have not been able to benefit from part of the program, which was designed to offer internships to them in the summer. COVID-19 has put pay to that, but our own employees are being urged to work both as mentors with those students and with Urban Synergy, which is an East London not-for-profit that is helping out underprivileged groups from ethnic minorities. And we're also working with Outward Bound. And in the acquisition, we discovered that SDL had a foundation and they were quite well advanced in terms of initiatives in the community. And we have moved to bolster that and relaunch it as the RWS Foundation. And on the governance side, at the time of the acquisition completed, we restructured the board and brought over two non-execs from SDL. So their former non-exec chairman, David Clayton, and their most recent, Ned Gordon-Stewart. So they joined the RWS board together with a lady called Frances Earl, ex-senior partner in Accenture, who is now the head of Remco. And not only in our annual accounts, but of course our website is very much enhanced in terms of the amount of disclosure we have across the whole ESG piece. And you heard Richard talk about the investment we've been making in data security. We were victims of the Microsoft fall over, but we're pleased to be able to get it back up to speed and with no damage to our client confidentiality at all. So ESG, you can take it for granted that we are putting substantial effort into it. So moving on, our strategic priorities. This is just pulling together what you've heard in the rest of this presentation. So we want to drive our organic growth. We want to put much increased focus on cross-sell and joint-sell, given the incredible customer base we now have. We merged with SDL in order to access their technology. And so as a group, we believe we have market-leading technology in the language service space, and we will continue to focus there. And you haven't heard much about acquisitions in this presentation. Whilst we do have a strong balance sheet and we have excellent bank facilities and we are seeing a steady flow of opportunities, I did say to you maybe half an hour ago that we are not focused on anything major at the moment. Our top priority remains the integration of SDL. But looking further out, if we come with acquisitions, I would expect them to be in the US or in Asia-Pac. They could be in bolt-ons into our existing activities. giving us geographic coverage or customer wider coverage. We could be into the last area that we're not represented in in languages, language services, namely interpreting. But that would be only if we can find a business off scale with a really good technology platform connecting the freelance interpreters with the clients. We've seen one or two of those things, but disappointing margins. So we've not been moved to do anything about that. So we move to the last of the slides in this presentation, summary and outlook. I've just said SDL integration, top priority. Second half, we've continued to drive on from the H1 numbers we've been looking at this morning. COVID is still, although we all know that vaccinations are going to hopefully rescue the Western world at least, we don't see that fully reflected yet. So you've heard where we are in IP. We're hoping that the lifting of all restrictions will improve that. But we're very dependent there on the European Patent Office. Our leading position in the marketplace, number two is probably $150 million behind us in overall turnover, means that we Definitely feel we are being invited into all the important RFPs and we will be able to capitalize on the fact we are number one and that we have the best technology and we have the highest quality. I've talked about the balance sheet. The board is very confident about the group's future prospects. I would sum up by saying the new enlarged RWS group sees opportunities wherever we look.