Good morning, everyone, and welcome to our H1FY26 results presentation. I'm Bill Berman, the CEO, and I'm joined today by our CFO, Ali Mann. The first half of 2026 saw strong strategic and operational progress alongside continued growth. Our teams continue to deliver and drive the company forward, including in North America, where the rollout of timewood.ai platform is gathering momentum. In August, we announced a recommended acquisition by Redjuve Partners. The acquisition was approved by shareholder holders last week and is expected to complete within the next month. I'll expand on that shortly. Ollie will then take you through the headline financials in a few minutes. Before that, I'm going to touch on the strategic and operational progress from the first half of 2026. In the first half of 2026, our key priorities have been, first, progressing on our North American product and development work. Secondly, continuing our system implementation with Lookers, as well as various other customers throughout the UK and Europe, as well as towards Japan. Thirdly, working closely with Marshalls, so we move near to starting the rollout with them in 2026. Lastly, in addition to selling the core system, selling our expanding suite of products to both existing and new customers. On our North American development work has continued at pace throughout 2026, both on all-important OEM integrations, but also to ensure that the system being rolled out is a best-in-class offering in the U.S. and Canada. We have been working closely with LITIA's team to ensure we hit our target rollout start in Q4 of 2026. We are in fact to do this, and this is a testament to hard work by both the Pinewood and LITIA teams. In the U.K., we have continued the system implementation as a local sealers and expect this to conclude in the first half of 2027. We have also been laying the groundwork with Marshalls to ensure that their system implementation gets off to a smooth start, with that work well underlined. Our products and development teams have developed some excellent new products in the last few years, along with the AI products we acquired with the CE transaction last year. We're now seeing the benefits of that work as we increase our sales across existing customer base, as well as new customers. One of the strongest proof points of the value that customers place in the solution is churn. In fact, we actually had negative churn through the first half of 2026 with increased system usage from our existing customer base. In mid-August, we announced a recommended offer from Redview Partners to acquire the The cash offer of 4.048p represented an attractive premium and provide playing with AI with access to deep technology expertise, long-term capital, and partner with a strong track record of helping software businesses scale. given how supportive our shareholder base have been over the last few years with a firm belief in the growth opportunity for pinewood particularly north america we felt it was important that we had a chance to continue to be involved in our journey with that my shareholders also had the opportunity to roll some of their stake over into the post transaction business we are delighted that so many shareholders took up that option and continue to be part of the next chapter of our
journey with us following the successful shareholder vote last Friday on the 25th of September the deal is now expected to complete between the 9th and the 23rd of October I'll now hand it over to Ali to take us to the financial review thanks bill morning everyone in the first half of FY 26 our underlying revenue grew by 18.4% to 23.2 million pounds this increase was driven by a number of factors, including the positive impacts from new customers, upsells for our existing customer base, and having a full six months of contribution from SEAS, whereas in the first half of FY25, we only had four months' worth of SEAS revenue, following the acquisition of that business at the start of March 2025. Underlying gross profit of £19.8 million was 16.5% up on last year. The gross margin rate of 85.3% fell slightly, as expected, and reflects SEAS's gross margin being lower than the wider plan of business. Underlining the DAW, which is our key profit metric, was up by 11.4% to £8.8 million in H1FY26. We have maintained our recurring revenue at around the 85% mark, with a marginal drop from last year. The majority of our non-recurring revenue is from new customer system implementations. Our net customer churn was negative in the first half of the year, meaning usage from our existing customer base on a like-to-like basis actually increased in the period, which demonstrates the importance of the primer system to our customers. On slide 8, you can see the movements in our cash flow during the first half of 2026. During H1 FY26, we generated £1.9 million of cash from operations. The reduction from £8.5 million in the first half of FY25 was due to the increased investment in our North American operation, which is shortly due to become revenue-generating, once the first liquor US dealers go live in quarter four 2026. The capital expenditure figure of £8 million in H1FY26 includes £6.4 million of capitalised development spend. In the first half of 2026, we completed the buyout of our final retailer, which was based in the Netherlands, for £3.3 million. We have now bought out all of the retailers that we had. These movements were the primary drivers of the net decrease in cash of £10.4 million, leading to an end of June 2026 cash position of £23.9 million. On slide 9 is the end of June 2026 balance sheet. They were closing shareholders' funds of £198.9 million, with the main driver of the increase from the end of June 2025 being the July 2025 North American JV buyout. We now have goodwill at £54.9 million on our balance sheet due to the buyout of Lydia's share of the North American JV, the SEAS acquisition, and the South Africa and Netherlands reseller buyouts. Our intangible asset balance of £166.2 million primarily arose through the North America JV buyouts and SEAS transactions, with the majority of the balance relating to the North America customer contract. Most of the tax liability we have relates to the USJD buyout, and we'll unwind as the intangible assets are amortised. Finally, we have £23.9 million in cash. In addition to this cash, we also have a £10 million RCF facility, which remains undrawn. On to slide 10, where we have the non-underlying items for the first half of FY26. There was a £0.3 million debit to revenue relating to the amortisation of the Global Auto Holdings warrants. We had £9.1 million of administrative expenses in our North American operation in the first half of the year. As guided previously, these costs will be treated as non-underlying until the Pimewood system is installed in 20 North American dealerships. As we start our system implementations for NIFIA's North American dealers in course of fall 2026, we will start to offset these costs as our North American revenue grows. There was a £2.8 million credit relating to net fair value gain on the Looker's Warrants. Our share-based payment charge was £2.2 million in H1FY26, and there was the £4 million amortization charge relating to intangibles arising on acquisition. I'll now hand back to Bill to run through the operating highlights and strategy.
Thanks, Ollie. Most of you will be familiar with this slide, which sets up Pinewood's key strengths in what sets us apart from our competition. As I mentioned earlier when talking about the first half of 2026, our customer current is extremely low, with the customer generally only leaving us if the organization is bought out by a larger group using a competing system or if a customer goes out of business, with both of these happening rarely. I've spoken previously about the importance of being 100% cloud-based with one code base, which is still unusual in our industry. Our customers all being of the same version of the system whenever they are in the world is a big advantage for us. From a security point of view, it's much more secure being a cloud-based platform than being hosted or using on-prem servers. Additionally, we are able to release software updates in a controlled manner, keeping our customers fully informed about any updates in the system functionality. The majority of our revenue is re-eventing, and generally it covers around 85%. our customers take quarterly in advance for the majority of their products the main part of revenue that is not reoccurring is an implementation income which we charge to new customers and some existing customers who went off pieces of work having a fully embedded AI offering with multiple AI products that's apart from the majority of our competitors in addition to our aid price being fully embedded they are also available to new customers on a standalone business without the main platform While we continue to innovate and recruit new talent, our expert experience workforce underpinned what we offer. We have 40 years' experience in the automotive industry, a large portion of which has been part of an automotive retail group. We have a unique team, many of whom work with us both for the software and auto retail industries. Finally, our partnerships with the OEM partners are central to our success. We have excellent relationships with our OEMs all around the world, and our market-leading technology means that our integrations with them are seamless in the benefit of all of our customers. I'll now take you to the progress we made against our strategy during H1-2026. We have made good progress on the Lookers implementation in the first half, with a number of important brands for Lookers now operating on the Pinewood system. The combined Pinewood and Lookers team worked together really well on that rollout. we continue to work closely with marshals on finalizing preparations for the rollout and we're in good position to start that immediately in our international markets we have recently signed a contract with our first German crew and have more expected to follow in the next several months in Japan the Porsche rollout is going well we expect to begin the Japan Volkswagen implementation in the second half of 2027 we brought our Netherlands reseller out in March of 2026, which means that we have no longer any other resellers. Our product suite continues to develop at pace with a number of products that our teams have developed over the last two years, now available to sell to customers along with the market-leading AI offerings we now have following the C's acquisition last year. The final pillar of our strategy, North America, is by some distance the largest automotive retail software market in the world. We are now on the verge of having time with System Live in the United States by the end of 2026, which will be a huge achievement. But just the beginning of our story in North America. We have hugely ambitious plans to firstly implement the system in oblivion and global auto holdings in North America, but alongside this to grow our market share as quickly and as aggressively as possible. Finally, on to slide 15. In the UK, we will continue to work alongside the local team to continue the rollout in the first half of 2027. We look forward to starting the Marshalls rollout imminently. With the Pinewood platform about to go live in the U.S., we are entering an exciting period in the company's history. We could not have a better partner to launch there with the Lithia team, and we look forward to growing our market share in the U.S. and Canada shortly thereafter. The acquisition by Ridgeview Partners will also accelerate our growth trajectory in all markets, but particularly in North America, where there is a significant addressable market. Thank you to all the members of the Pinewood team to continue hard work and driving us We'd like to thank all of our shareholders for the support after the last two to three years and we rely that many of them are enrolling their stake for the continuing journey with Thank you for joining us today. We welcome any questions.
Operator
Thank you. Ladies and gentlemen, if you wish to ask a question over the phone, please signal by pressing star 1 on your telephone keypad. You may also submit your questions via the webcast. Again, it is star one to ask a question on the phone. So the first question is from Andrew Wake from Jeffreys. Please go ahead to your line as often.
Morning, team. A bittersweet moment, but I guess congratulations on a good job. Two questions from me. First one, in terms of lookers and also the U.S. pilot stores, any feedback you can give us, sort of interested across the board, whether it's from a dealer level or whether it's sort of from from further up the chain and just i suppose more interest on the looker side of things how how they're they're viewing the dealers are viewing the implementation and how it's changing their lives and so on is it making things easier is it making cost savings possible so that's uh that's the the first one and then And the second one, following the USJV buyout, have you had much in the way of further conversations vis-à-vis future US partners? Thanks very much.
Hey, Andy. So, yeah, bittersweet. I'm sure somehow you and I and Philip and the whole team will still be engaged for the years to come, but I think it's a pretty hard time for the company as a whole. Yeah, absolutely. Well, it's definitely Phil's fine. But as we go forward, I can tell you, I'll kind of start with your second question and kind of tie it into your first one. We've had lots of conversations with lots of large, medium-sized groups in North America. We did NADA this year. In addition to kind of winning Best Booth and Best New Entrant, we had a tremendous amount of engagement with various dealers of various sizes out of Canada and the U.S. and they're very impressed with the product. I can tell you on a Lithia sense, as we get ready to roll out, you know, later this year, first source with them in North America, we have done deep testing with them, both in sandbox but in live actuated stores. They let them see the product, and the U.S. team has been really impressed, and they saw the same benefits that Lithia, U.K., and even the prior Dardine stores as they came out of the platform in 24 saw as well. So, real positive things coming out of North America. Can't really speak for other customers. I can tell you the Looker as well has gotten very little. They have been great partners. They're liking the different products that we bring into it. They're looking into putting the AI products in starting later this year and into the next year. And they have seen the same type of results that Lithia UK saw as well. I can't get much deeper into that. You'd have to ask them more specifically because they've got other things to docket on their end, but they've been great partners. I think the biggest thing I can say with Lookers, Andy, is their leadership and management teams. The UK has been incredibly supportive and helped roll things out, but even at the next level up, they took their warrants and rolled it into equity and are staying off as a shareholder in NUCO. And I thought that was a great testament. They could have taken some money off the table, and they decided to put that back into the company. and continue on the journey with with time with great thanks very much for them thank you thank you thank you we have no other questions with that we will close the call thank you for listening Thanks, everybody.
