Tristel PLC

Good morning and welcome to the Tristell plc interim results investor presentation throughout recorded presentation investors will be in listen any mode questions are encouraged and they can be submitted anytime just by using the Q&A tab that's situated on the right 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 received in the meeting itself however the company can review all the questions submitted today and publish responses where it's appropriate to do so before we begin I'd like to submit the following poll and now, like Tanya, to Chief Executive Matt Sassoni. Good morning to you, sir.

Good morning, and good morning to everyone that is joining us online today. Thank you ever so much for taking the time to listen to our 2024 interim results. I appreciate many of the people that are joining us this morning are aware of the Tristell story and what we do. But for those that are new to Tristell, I'm just going to take the first couple of slides to explain who we are, what we're about and what we do. So our company is an infection prevention company. Our purpose is to prevent the transmission of microbes from one object or person to another. How we achieve this is by applying our very powerful chemistry, which is chlorine dioxide, to the target environment, surface, or medical device. Our products fall into sort of two categories, really. We have our tri-style range, which is focused on the decontamination of medical devices. And we have our cash range, which is focused on the disinfection of hospital surfaces. You can see there we have an ambition to be a leader of the Tristell leader in the point of care decontamination of medical devices. And with regards to cash, our ambition is to be the global market leader in the niche of sporicidal surface disinfection. So not the entire hospital surface disinfection market. When you look at the split of our two businesses, you can see the Tristell represented 87% of the H1 sales, and you can see which kind of target medical devices that we apply our chemistry to. And we're mainly focused on non-lumen or single lumen medical devices that are heat sensitive, that can't be sterilized or decontaminated by normal means. And in the last 12 months, our chemistry has been used over 23 million times for the medical device decontamination. Then sort of newer portfolio, the cash portfolio, that represents 8% of our H1 sales. And we are focused on sort of the more general market and surface disinfection. And you can also see there, we've put for the first time, the number of kind of cleaning events or disinfection events with our cash range, which is 20 million. So it's a large number, but obviously generating much smaller revenues. How do we win? Well, on the tricel, it's always our value adds and our value proposition which customers really appreciate is the convenience. We have the ability to provide disinfection at the point of care. We do it in a very fast and efficacious manner with contact times between 30 seconds or two minutes, depending on the product. Our chemistry is safe and presents no risks to the users. And really, things that set us apart is our compatibility. Over the years, we have been tested and approved to be used with thousands of different medical devices. So, you know, we have a very compelling offering. We do have competitors, and these are a variety of forms. Some are manual, like soaking, and others are automated, like vaporized hydrogen peroxide. On the cash portfolio, we win again through the unique qualities of our chemistry, demonstrating higher efficacy than the products they use today, faster speed of action compared to what they're using today. And then we're addressing some of the needs that our users have. If we take antimicrobial resistance, for example, some of the cleaning products that they're using today are actually adding to the problem, whereas this is something that we do not contribute to. And also some of the chemistries they use today are quite toxic and damaging to the environment. And again, this is something that we're able to differentiate ourselves with regards. So, you know, we have some great products and an exciting market. And I myself have been with the business now for five months. So I thought it'd be worthwhile for me just to spend a little bit of time to tell you my impressions after the first five months of being with the business. First of all, it's an exceptional company, not just with regards to our people and our products, who are talented and outstanding, but also the value that we're able to deliver to our customers. And then operationally, we're excellent. We have a robust supply chain, we have first class manufacturing, and a great R&D team and a team that supports us on our day-to-day operations. We have been a business that's created the market for ourselves. We've been tremendously successful and comes with that, our competitors. And we see that these competitive pressures are increasing. It means we need to sort of sharpen our needle and to maintain our success. And what we're doing there is focusing on our execution. But I don't want people to get too concerned about the competitive pressures. There's always been competitors for our TriStell offering. We're just having to deal with more local players that occasionally pop up. But the team is well-versed in what we need to do and ensuring that it doesn't distract us too much from our day-to-day activities. When we look ahead, it's a very exciting future for the business. I can see a significant runway for growth ahead. In markets, we are taking share. We're seeing customers use high-level disinfection more and more, so the adoption is increasing. And we also recognize that, you know, we are penetrated in a few markets across the globe, but there's many other new markets waiting for us to open up and for us to start selling our chemistry in those. So, you know, the near term opportunities are very exciting. Over the last few years, we've invested significantly in our surface disinfection market. And this represents a significant opportunity for us. But also, we've got to take some care as we go forward for this market. Our secret success over the years has been focusing and being very targeted on profitable niches. And we need to apply that same rigor to a surface disinfection market. And I'll talk a bit more about this in some of the slides coming up. The near term opportunity to drive global penetration. Yeah, basically, what I'm trying to say here is our greatest opportunity for growth is going to be, you know, within our existing markets with our existing portfolio, you know, we are far from being penetrated. And we have the UK market as our core home market. But when we look across the globe, we see great opportunities to drive greater growth and also drive greater growth in the UK too. in the mid to long term we see the potential to unlock major new markets and everyone is very much focused on the usa i will provide an opportunity on the usa but the headline is you know we feel very bullish about our success that we've had so far and the future and we believe that we can win and win big in the usa market

Morning everyone, this is Liz Dixon here. I'll run through the financial highlights with you here and we're looking at a set of results here where we've delivered strong performance in this first half. It's in line with both the market expectations but also with our own internal forecasts, our internal targets. Running down the highlights themselves, revenue increased by 8%, up to 22.6 million. That's 9% of constant currency, which is, of course, slightly behind the growth rates that we have achieved in recent times. But we know where the issues are that have reduced our revenue growth percentage, and they are all fixable problems. So we feel that... Returning to double digit growth is definitely achievable for us. But running down the P&L, then we can see that adjusted profit before tax increased by 19%, which we're delighted with, up to £4.9 million in the half. Adjusted EBITDA was up by 14% to £6.3 million, and we achieved an EBITDA margin of 28%. Adjusted EPS sat at 8.17 pence per share. It was negatively impacted by an increase in the effective tax rate, which increased from 10% up to 25% as a result of patent box relief ending in this financial year. But nevertheless, our interim dividend has increased up from 5.24 pence to 5.68 pence per share, payable on 11 April with an ex-dividend date of 20 March and record date 21 March. And that leaves us with cash and deposits, which increased up to 11.7 million, up from 10.8 in the comparable period. And just a reminder, the company has no debt. Over on the next page, operational highlights. Well, Matt joined us in September last year. And I think we can state very confidently that it's been a successful transition. And he shared with you his first impressions. During the period, we made our application, our submission for a second US product clearance under a 510K. So this is for Tricell OPH. It's a high-level disinfecting foam for the decontamination of ophthalmic devices. We received a request back from the FDA for additional information. And we're... In the process of compiling that test data, it is not a surprise to be asked to provide additional information, but we're going through the process of collating that and we will submit that back to the FDA shortly and still expect clearance by the summer of this year. And then a couple of other operational highlights that refer to the regulatory landscape that we're working within. The first is that we have been included in the revised American National Standard for our Tristell Alt technology. So that's an update which now makes clear to users of Tristell the product that they can use a foam or a wipe that contains chlorine dioxide. And of course, we are the only supplier of those types of products of that technology. And they can happily use those products within the US. And then the second regulatory point relates to Germany. So we've had much slower growth in Germany over the course of the last couple of years as a consequence of a question mark hanging over whether wiping a medical device is a validatable methodology for decontaminating it in between patient use. Well, now the regulators in Germany have agreed that wiping is a validatable methodology methodology and so they've issued a new guideline which means that customers can now validly use it without any concern. Moving over onto the next slide, looking at sales growth by geography. Well, you can see we've got a couple of areas that we have had some issues with, namely Australia, also within the Western Europe line, France, and Hong Kong. So there are three areas that we need to pay a little bit of attention to. I'll run through them one by one. In Australia, we We have invested in our sales force to build it out, having had a few individuals leave the company over the course of the last year. It does take a little while to get new salespeople up to speed. So we have seen flat growth in Australasia, but we expect that to rectify itself as we move into the end of the second half and into the first half of next financial year. In France, similarly, we've had a change of leadership in the sales team. And in both markets, we also have competitive pressures, which Matt touched upon. But none of these things are permanent problems. They're all fixable issues. And we have confidence that in both of those markets, we can return to growth in the short term. And in Hong Kong, we have seen, again, zero growth in the period. And that's predominantly because of our surface products, where what we see is where there's an outbreak or an epidemic, particularly in Hong Kong, then there's very swift take-up of highly efficacious products to decontaminate surfaces, such as our cash range. But then over time, when cost pressures rise again, then we see the use of the product slowly dissipate. Well, that's a pattern that we're quite used to now in Hong Kong. But we are looking to roll out our newer cash products out in Hong Kong to address that. But looking at the more positive side of things, Central Europe, on the back of that guideline change, we see 13% growth driven by Germany. In Southern Europe, 14% growth. That's predominantly Italy. But we are going direct in having... uh set up our own operation in spain with effect from the first of january so we expect strong growth in spain as we go through the rest of the financial year malaysia and singapore also good growth and um the americas of course it's the um we're showing flat growth but that's because of the mix there of royalties product sales into the US and also Latin and Central America are playing an important part in that growth but all looking good in the US and Matt will tell you more about that as we go through the presentation and of course the UK is the big one here seven percent growth which we're very pleased with because last year we had a high level of growth as a consequence of price increasing But now growth comes almost exclusively from volume increases in the UK, which just goes to show that even in very well-established markets, there's always new opportunities for our products.