Vista Group Investor Day Presentation — 26 October, 2022

how do you know hey um thanks everyone um we're just running a couple minutes late but thank you for taking a seat we will leave some cheers there for the late attendees my name's Matt Cordon CFO of Vista group really delighted to have you all here in person to um to uh listen and hear what um first group's got to offer going forward uh just some housekeeping first uh emergency exits the door you came through uh don't trip on the carpet or the um well the banners on the way out um there is also an exit through the garage if that one is closed so out the back doors to the left or to the right and if you need the bathrooms I will leave that door uh you use that door to go in and out of the session the bathrooms uh to your right is your exit here go around and uh gents on the left means on their form is on the right and please join us afterwards for some drinks they will be upstairs we've got some product demos because you're here in person taking a little bit of time we're going to show off EQ uh spoiler alert um which is uh we're super excited about and plus our digital Suite of products so there'll be some demos going if you'd have a look and interact with plus some drinks and a bit of food um so yes phone's off if that's right and let's get underway every film starts as a simple idea a story that needs to be told but there is another epic story happening behind the screen and we are the ones who make it happen from creation and production through rights and distribution from insight and campaign management the cinema systems globally [Music] and locally from the films people need to see [Music] performance every film delivers we are there connecting the movie Journey so the magic of every story can find the people who long to see it Vista group brings people together Global reach seamless integration and specialist platforms so more people can experience more will be magic thank you foreign [Music] to the film industry and uh good morning good morning who wrote that must be myself uh good afternoon and Welcome to our 2022 investor briefing and welcome to those of you here in person and to those of you online it's really exciting for us to have the opportunity to take you into a bit of a deep dive into our business into our platform my name is Kimball Riley I'm the group chief executive and today to the extent that I'm going to be an MCN host I'm going to be MC and host I'd like to highlight that several of our directors are in attendance Susan Peterson our chair down the back row one of our independent directors James Miller sitting next to her and online independent director Kirk senior apologies to Murray holdaway our founder he was very keen to be here but unfortunately circumstances prevailed otherwise as opposed also to Chris Nicoli and Claudia Batum I'll leave you to read the important notice everybody's finished thank you uh you'll no doubt be relieved to know that I'm not the only speaker today a number of our exec team are joining me and presenting and I'd like to introduce them to you now in order of appearance Matt Liebman Chief Innovation and data officer will be providing an overview of the cinema and movie industry Sarah Luther CEO of group company movieo will be providing a moviegoer view of our platform Leon newnam CEO of Group Company Vista Cinema will be providing a client view of our platform and Grant Smith CEO of Group Company Vista Cinema will be providing an execution plan of our technology and a Ferguson will be describing our strategies around people Anna is our chief people officer and Matt Court who you have already met our CFO will be taking you through the key elements of our financial aspirations but first you'll be hearing from me today is a really important day for us as we try to bring you into our inner sanctum so to speak of our journey to assess Cloud future and I want to underline several key messages messages which will be expanded upon by subsequent speakers firstly that our primary Market Cinema and the theatrical experience is in very good health and with considerable upside firstly is the volume of content returns to a more normal level and secondly as the impact of premiumization raises the quality and differentiation of the performance the platform we have built in which we continue to improve and develop offers our clients the best experience in the industry we've seen strong client interests from all territories and with clients of all sizes and in that regard it's really pleasing to me to see that our value proposition is clear and we're seeing increasing engagement as understanding grows our platform will enable us to significantly increase our addressable Market both with our existing clients and in attractiveness to new clones and what's really exciting for me is that we can see an infliction point in our investment profile in late 2024 which we believe will support free cash flow during 25. as we've mentioned in previous forums we are investing in engineering to build the efficiency we all know SAS can deliver so a projection that the investment will Plateau in late 24 is actually a little bit earlier than I was predicting we'll be keeping a really close eye on that these are the key messages that you'll see coming through our presentation today and I want to talk to you about strategy we're a purpose-led organization and our purpose is clear to bring more people together to experience the magic of movies and cinema by creating the platform that connects the industry empowers the moviego experience our strategies are simple and straightforward firstly we support our clients this is critical for any business obviously but it's also fundamental to the way we do things we do good things with good people secondly and most strategic for us we will expand the capability capacity and Adoption of our platform a platform which we believe can power the industry globally and thirdly we'll continue to seek and potentially invest in new opportunities opportunities related to our platform and our core competencies today we'll be drilling deeply into strategy 2 expanding our core platform strategically this is the most important thing for us and for our customers however for completeness before I go on to talk about platform I'll briefly touch on our supporting strategies for us supporting our clients has largely moved into what we describe as business as usual we delivered a lot of technology to help Cinemas deal with the impact of the pandemic and we have scaled our support organization to meet a customer base whose activity levels are pretty much back to normal pleasingly we've seen our MPS scores track back as well so levels similar to 2019. as to creating and investing in new opportunities our focus is quite narrow primarily around our platform first strategy and opportunities which have the possibility of real scale we'll talk a lot about platform today and as technologists and a lot of us from Vista group who are in the room and otherwise are technologists we have a tendency to assume people already know what we're talking about or alternatively we provide a detailed and thorough explanation which often leaves people no further ahead so today I'm going to try and go down the middle on that and outline at a high level what we mean when we talk about platform as you can see from the diagram on the slide there are three elements making up the platform for us we have the Vista Cloud platform which replaces all the technology and on-premises customer will have in their Cinemas and head office our tagline for this is simple and serverless we also have the Vista digital platform which serves online chat sales channels such as mobile web and kiosk which are clearly increasingly the methods of choice for movie guy purchases and we have movio EQ targeted to replace movieo Cinema and delivering marketing automated automation at a terrific level of sophistication and ease of use I now want to drill a little deeper into strategy too we sit out our strategy with a Clear Vision to deliver a platform for our clients which was the outstanding proposition in the global market and we're well on the way to achieving that we know that as well as being good for our clients this will be good for Vista group we focus on our clients biggest problems smooth and seamless experiences for moviegoers motivating more moviegoers to see more movies more often and helping our clients ensure moviegoers enjoy the fullest possible experience in technology terms we'll be able to get Innovation into the hands of our clients faster and more easily in scaling for Peak demand will be delivered effortlessly this letter point is a challenge in some ways quite unique to cinema with up to 80 of ticket sales and transactions occurring in a weekly window of less than 10 hours it's a hugely peaky volume curve we will also be able to significantly reduce the operational workload for Cinemas and significantly reduce their capex requirements what's good for our clients is good for Vista group but our platform is also good for us directly we'll be able to Target a much greater share of our clients technology spend as we deliver a much expanded service we expect to be able to reduce our working capital requirements as we expect payment profiles to be more closely aligned with moviegoer activity we also expect to see greatly improved operating leverage as we are able to manage multiple client Estates with Consolidated teams as well as significantly reduce the amount of versions and iterations that we currently support under the on-premises model I believe this expression can be a bit overused but I genuinely believe that our platform will be a win-win for Vista group and our clients and that belief fuels our aspiration where we believe we can go it is our aspiration to drive our business to over 300 million of group ARR on the back of our platform with ebitda between 25 and 30 percent and a market share of Enterprise Cinemas of over 60 percent and we believe that we can execute on this strategy and reach our aspiration relying on our current funding Arrangements for those of you who don't know the expression ARR it means annual recurring revenue and it's a way of measuring the strength of your SAS or subscription-based business driving ARR will be our major Focus as a business going forward as it has been for the last two years as you will see later in this presentation we're expecting to see some variation in the platform prices we're able to command variation in the adoption rate of the platform and variation in the speed of deployment of current and new customers to give you a sense of the significance of our aspiration our group ARR in 2019 was a little over 90 million dollars and at June this year we reported 112 million so our aspiration is to get to three times where we are today we haven't put a specific date on when we will deliver on this however we have identified what we see as a key inflection point in late 2024 our projections and our modeling based on current trajectory in data points will see us reach an inflection point in late 24 at which time we expect to see our investment bump Plateau as we'll have delivered the bulk of the heavy Engineering in our execution roadmap we're ramping up our investment in engineering over the next two years in order to enhance the scalability and reliability of our platform we'll be doing this in parallel with transitioning new and existing clients and continuing to provide the best possible levels of support for our clients who have on-premises deployments in late 2024 as I say we expect to see the investment bump flatten out and for the group to be delivering be delivering free cash flow during 25. our Target is to report group ARR of between 175 million and 205 million in 2024. if I look back to when we started this platform journey and then consider the way we have overcome the obstacles that external forces have thrown at us I couldn't be more proud of the team to see an inflection point such as this perhaps not quite within touching distance but certainly not too far down the track it will be a terrific achievement for us to pull it off so I'm now really pleased to hand over to Matt leibman who will give you the good oil on the cinema and film industry okay thank you Kimball and thank you everyone for your time today so I'm going to give a bit of an industry update here we're going to look at the field of play for Cinema we'll assess some of the current conditions in the uh the impacting performance at the moment and then we'll look at how the industry is performing today and where it's going and look I'm not going to ask you to lean forward with the same Enchanted look as this guy on the screen here but if we could avoid any Will Smith slaps that would be really appreciated let's start with the field of play and look at Cinema's competitive boundaries Cinema straddled Two Worlds it straddles filmed entertainment and out of home Leisure and the benefit here is it gives the industry real resilience by satisfying multiple diverse needs let's take filmed entertainment first and when we do that we need to think of filmed entertainment more broadly than just the movies it does include TV but it's not just professional content that we need to consider we need to think about user generated content as well because the saying is content is key nobody said quality content's key so we're thinking of cat videos we're thinking of tick tocks we're thinking of anything that takes somebody's entertainment attention away from the movies and then we can look at out of home Leisure and these activities aren't mutually exclusive to going to the movies it's quite common for people to consume multiple ones in one activity back when I was in Industry we did research that found that our customers were spending about thirty dollars before and after the movies but not in the cinema itself and we've seen the industries trying to grab that share of wallet now you know for example dinner and a movie has become dinner in a movie with dine in and premium screens and we're seeing a lot of Cinema change including a lot of our clients moving to family entertainment centers clients like Cineplex and BNB and Santikos an event announced they're moving in this space just last week and so they're bringing within the same four walls bowling and gaming and Laser Tag mini golf and trying to get that single view of customer and that massive share of wallet so if these are the boundaries let's talk about the sentiment This research was done by U.S talent agency UTA and it looked at what people were most excited to attend as they got to come out of their homes post-pandemic and the blue lines show three entries for Cinema the top one being traditional hard top Cinemas that you go to there was Drive-In and Outdoors which were already on the rise pre-covert and continue to grow and then film festivals and the top entry number three is just behind concerts and sporting events now this shows that people miss going to the cinema and going to is the key word here because it's more than just the movie itself we're talking about a holistic activity and why they miss going to the movie is on the right side there and it's more than just the content what we're seeing is that this love is is structural it's in the building it's when the lights go down and you're in your favorite seat with your favorite treats with your favorite people and the story starts and so that shows it transcends the film itself and the cyclicality that comes with content although nothing beats a great movie and over the course of this presentation we'll show how this intent is borne out with Admissions and box office data so we know that people have a love for the cinema as well as the movies let's look at what industry Outsiders frequently overstate as the core competitor streaming now I'm going to touch on this chart in a second but let me contextualize streaming up front it's a delivery mechanism it's the latest delivery mechanism to get content in the home it's TV 4.0 it's video 3.0 it's cable 2.0 especially as we started to hear Talk of the providers consolidating and as we're seeing talk of advertising and bundles coming back into it so it's important not to conflate the way people get their content versus the content they consume itself now to this chart this was a study conducted by U.S research firm morning consult in July and it was done looking at U.S premium video and demand customers or p-vod customers now pivot is defined as somebody who spends at least 19.99 for one-off access to a movie that is currently playing in the cinemas and what the research found is that those who use premium video on demand were far more likely to have visited the cinema at least a few times in the prior month it was 55 for pivot consumers versus 27 for everyone overall those who subscribe to the greatest number of streaming services the most different brands were also the most Avid Cinema goers and they found that those who went to the cinema at least one time during the month of June were most likely to watch a streaming service at least daily their analysis went on to find that a movie that is playing simultaneously at home on pivot and in cinemas will experience cannibalization in the box office but they found the box office didn't erode because these people just chose something else to see and you can see that with the recent release of Halloween kills which Halloween Halloween ends which played simultaneously at home and in cinema it dropped Paramount's film smile has had one of the greatest holds we've seen of a horror film in recent years it shows there's a transfer of Revenue not an erosion of Revenue so what this is is all else being equal streaming and Cinemas can co-exist you know it's kind of like going out for dinner when you have a perfectly good kitchen at home so we know that there is love in the hearts of consumers for both Cinema and for streaming but the studios don't care so much about the love part of things for them it's all about the dollars and what they've learned through the pandemic is they explore different release patterns and methodologies is that a scorched Earth favoritism of streaming is bad for business on the left here we have the head of Paramount Pictures and he wrote or was quoted as saying when a movie has a presence in cinemas it gets an era of legitimacy it's a real movie and that credibility boosts both the popularity and the returns Downstream he went on to say they're looking to up their theatrical release slate by 50 year on year and while there are examples of very big budget director streaming movies with big casts and crew and so on the hard-nosed new ad head of Warner Brothers Discovery has concluded that these expensive director stream movies don't make Financial sense let's take a quick look at a case study here so I've put two movies up the one on the left Doctor Strange the one on the right the director streaming Netflix filmed the gray man both had a similar budget of 200 million dollars both got released on streaming platforms roughly around the same time and racked up the same number of initial minutes of streaming or viewership but there's one difference between these two films the one on the left Doctor Strange had earned a billion dollars at the box office before it made its way to streaming the 200 million dollar film on the right is apparently Netflix's most expensive film ever and it was knocked off its perch as the number one film with streaming on Netflix Eight Days Later by a low budget romantic comedy called Purple Hearts and take one step further if you think about uh House of the Dragon the The Game of Thrones uh sequel its first season also cost 200 million dollars but you've got 10 episodes for that effectively you've got 10 weeks of retention for that so if you've got to drop 200 million dollars you're more likely to want to do it with a premium cable series for retention than for a 200 million dollar two hour one and one one and done streaming movie so we expect the trend for premium series to be coupled with lower budget feature films on the streaming platforms going forward and the ten poles will continue to shine in the cinema but we have talked about the coexistence between streaming and Cinemas and until recently what that really meant is that Cinemas were expected to give and the streamers were expected to take but that's increasingly changing and it's becoming a two-way street and here are three recent examples the third part of Magic Mike was meant to go straight to HBO Max Warner's has rethought that it's going to the cinemas the middle example is a new uh what was going to be a new Disney plus Marvel TV series arm awards that series is now going to be turned into a feature film for the cinemas and in a landmark negotiation Netflix has agreed to play the sequel to knives out in cinemas for a week in late November before a 30-day window and sending it to the the streaming platform and so this is a beginning of a thoring that we never thought was going to occur let's have a bit of a look at windows so this is often seen as the defensive moat for our industry and as we went into covert that window was 90 days long it's looking like it's going to settle at about 45 days now so what we did was look at the top 10 films at the box office in 2019 and looked at what percentage of their box office total lifetime box office was earned in the first 45 days of release and you can see on average it was about 95 percent in that first 45 days but the other thing is the lights didn't go off after 90 days these films averaged 129 in cinema so if a film performs like Top Gun it will stay in the theatrical window and the studios like Paramount did will delay that streaming release so now we know the boundaries of the industry the filmed entertainment and out of home we know the public continues to yearn for these Collective out of home experiences and we know the studios are coin operated and there's money to be found in cinema so let's take a quick look at the conditions of the industry first of all let's explode the affordability myth what we did here was look at average income in a range of different countries and compare it to the average ticket price and what we found is on average a person needs to work 26 minutes to buy a ticket in their local market at the average price and this ranges from 15 minutes in the U.S to 39 minutes in Japan so that's less than 40 minutes anywhere in the world for two hours of out of Home Entertainment and we know this is a fraction of the cost of concerts and sporting events but let's compare it to some more everyday forms of entertainment I took a look at Botany Downs for those in the in the Auckland Market it's a original shopping center it has a 10 Pin bowling alley it has a laser tag and it has a first run Cinema 10 Pin bowling one game might last say 30 minutes the cost of that 16.90 laser tag lasts about 15 minutes and that's 13 a feature film lasts about two hours for 23 dollars there is a lot more bang for buck a lot of affordability going to the movies the other myth is around ticket price Rises now ticket price Rises have been and are forecast to remain modest the average ticket price between 2015 and 2021 Rose by an average rate average compound rate of just one and a half percent but a lot of this was motivated by product mix for that period saw a rollout of recliners of Premium large format screens of gold class and dining so you were paying more but you were getting more for what you paid it wasn't a like for like increase and looking forward omdia one of the leading Market researchers for our sector forecasts a modest 1.9 compound growth between 2021 and 2025. and finally we look at economic conditions and Cinema has been incredibly resistant to slower economic conditions what we found over the last four recessions is the box office Rose for three of them so it's not bulletproof but there is definitely a resistance to downturn as people migrate for more expensive forms of entertainment leisure travel and so on to an affordable Escape just down the road so we've looked at the field of play we can see that the conditions aren't adverse let's have a look now how the industry's tracking and what we can expect looking forward Cinemas come back and audiences are returning so long as there are sufficient and diverse movies to watch and that's definitely on the case and look the industry's recovery is in due no small part to this Captain Pete Maverick Mitchell but he's not the only reason for it what we've done here is look at box office since the end of Omicron and two of the top five films of all time Spider-Man and Top Gun have been released in that window when we looked at the domestic market and for those of you who are less familiar domestic essentially means North America the US and Canada there are four other calendar related Blockbuster records that have been broken over that period And there's a diversity I mean every Blockbuster is is sort of of General appeal that's how you get Blockbuster status but what we can see here are family skewed films with minions four quadrant Marvel films including one featuring the first Asian lead so diversity of of people on screen and all the skewing reboot that broke out and became part of the cultural Zeitgeist so we're seeing a range of titles and there are more on the horizon and I'll touch on that in a second but it's also worth talking about food and beverage because the rule of thumb in our Industries you break even at the box office and you make your profit at the candy bar and what we can see here with the most recent results from a number of listed businesses is that their food and beverage spend is up and in some instances at all-time high we recently uh interviewed the head of food and beverage for Marcus Theaters out of Wisconsin he's also on the board of national board of directors for the national concessionaires in the U.S so the industry body and his quote his observation was I'm willing to say that those have come back have definitely spent more than they did more than they did previously but we'll go back now to the box office and what we've seen here is that when there are movies around box office bounces right back and we saw a lot of momentum and it was picking up at PACE until recently in August and September box office dropped off but it was expected by those of us in the industry and it was due to severe short of major shortage of major releases and that's beginning to reverse so let me break these two charts down for you at the top we're just looking at box office for the domestic Market each month from January 2019 through to September 22. the one below it is a given month's box office as a percentage of the corresponding 2019 month so take January 2020 on the bottom one what it's saying is box office for that month was about 110 of January 2019 and you can see how that was trending upward through the balance of the year in aggregate the window between May and July exceeded 82 of 2019 box office or reached 82 percent of 2019 box office and July alone was at 88 percent we're expecting this to pick up again with the most recent releases of Black Adam and the U.S release of ticket to Paradise over the weekend both of which exceeded uh initial pre-release forecasts in terms of frequency what we see is those who attend most are into the overarching Cinematic experience whereas those who attend least frequently are more driven by a particular movie now tied to this Blockbusters disproportionately Drive less frequent moviegoers which makes sense because if you're going to hit Blockbuster status you need a lot of people coming in the theaters and you can see with um Spider-Man and Maverick the most pronounced uplifts are um with the less frequent and the infrequence the two darker bars down the bottom and you can see that real Kink has a particular film attracted those less frequent Cinema goes into theaters now a couple of people ask me about this very frequent category that represents about four percent of moviegoers in averages a cinema visit a week these people tend to be heavily male skewed they're weighted at 25 plus in age group they need to be because they have to fund a weekly Cinema habit amongst all their other costs of living they tend to come on the night a movie comes out if there's a preview they're there on the Wednesday night in this part of the world otherwise it's Thursday and they tend to buy single tickets more than big family packages in other words it was me before I got married and had kids um when you look at these frequents the pink bar at the top you can see they've plateaued a little bit and that's because there's been a lack of diversity of content and that's not just the number of films it's the type of films that bring people back for the first time not everyone comes for for a top gun or Doctor Strange but we are starting to see that change we're getting into the awards season now the Discerning titles are starting to come out and we're seeing some genres that have been underserved like rom-coms come back with ticket to Paradise which in this part of the world has well and truly outperformed the initial U.S results but overall there has been a supply chain issue as one executive wrote our business goes in two-year Cycles anything we're seeing in the box office now well the studio became pregnant with that two years ago and what was going on then the pandemic so let me explain these two charts they're broadly similar to the the box office I showed two pages back but what we're doing now is looking at the number of movies released each month from January 2019 to September 22. the different colors represent three different types of movies you can see at that time so the the pink at the bottom are new wide releases a wide release goes out in more than 600 screens in the US the lighter pink are limited releases so under 600 screens and the blue ones are what we call holdovers a movie that started in a prior month but it's still on screen in the in the present month we're looking at and you can see in total but also with some of the subsections just how few there are as you move from left to right and then below we've done the same thing as we did with box office we compared a given month with the corresponding month back in 2019. so if you look at new releases and compare 22 to 2019 new releases are only at 55 of that level new wide releases the Blockbusters are only at 59 and total movies in Market when you consider holdovers are at 47 percent but if the Situation's largely driven by supply chain both the number and the diversity of stories that are available in the cinema helps on the horizon as Bloomberg's leading sector commentator wrote and it's been endorsed by other journalists such as Forbes and so on the studio swear that next year things will come back to some semblance of normal and a quick look at the schedule for next summer confirms as much they'll be releasing Blockbusters every weekend now what I've put up here are just four titles and a little bit of of author's discretion what I think will be the top four any given month and you can see a real diversity here so you've got the the potential record Breakers with Avatar SQL Indiana Jones the latest Fast and Furious the second part of Dune Tom Cruise back again thank God for Mission Impossible their rebooting Transformers they're bringing a prequel to The Hunger Games there's another John Wick and Creed and I haven't even touched the Marvel Powerhouse we've got black panther which is on track to break the all-time November opening based on its pre-sales you've got Ant-Man the Marvels Guardians of the Galaxy and the latest spider-verse DC which announced to shake up in some of their creative team today in a really exciting way has hit the market with Black Adam over the last weekend then you've got Shazam Aquaman Flash and Blue Beetle but it's not just about the tin polls we need diverse stories and we're about to see titles that appeal to older moviegoers and Discerning Cinema goers you've got Spielberg's semi-autobiographical the movie The fablemans which is already getting massive buzz from the film festivals uh Rock biopics have done really well with queen and Elton John and there's a Whitney Houston one I want to dance with somebody coming Damien chazelle's La La Land one Oscars his sequel babylon's coming with Brad Pitt and Margot Robbie taika waititi has won a non-marvel one for a change in April called next goal wins based on a true story Christopher Nolan always up for Oscars coming with Oppenheimer and then there are families which is great because they come in big groups and they spend the concession stand Puss in Boots Disney's Strange World Mario Brothers and the live-action Little Mermaid and Wonka and I've only just scratched the surface of this chart let alone the ones I couldn't fit on it so all of that goes into organizations researchers like omdia predicting that box office will continue to grow and that by 2024 the global box office level will exceed the pre-pandemic number of 2019. over 2015 to 2025 so the whole span of this chart we'll see box office grow from slightly over 38 billion dollars U.S to a little over 48 billion dollars U.S and taking the 2019 to 2025 subset that's a compound annual rate of 2.4 percent if we look at what we call our direct markets and exclude China and India the growth is still there it's a move from about 30 billion dollars to 34 billion dollars at a compound rate of 1.8 percent and when you have money coming through the door it continues to see investment in the industry with screens and uh and sites continuing to grow so again this excludes China and India and we can see between 2021 and 2025 a one percent compound growth in both screens and sites and the only region in the world to experience any type of decline is North America at a very modest 0.5 between 21 and 25 but that's when you see old unrefurbished sites start to close it doesn't have a bearing on admissions because there's generally one just down the road so box office is preserved but the overall viability and profitability of the industry is bolstered so all that's a good news story I think the critical part is that Cinema can't be stagnant and it's just not in the industry's DNA to do so so let's look at the cinema box and where it's located let's look at what's in the box to quote Brad Pitt from seven let's see how moviegoers are attracted to the cinemas and how they move through it and let's see how exhibitors serve them so if the cinema experience with them was a mathematical equation it would be the premises and what's in the premises it would be the content and it would also be the service that's given now that's the interpersonal service but the service the technology such as our group provides moviegoers and the way people navigate through all of that is their Journey now we've talked a lot about content already that there's a supply chain issue that's being overcome and that the future lineup looks really good I just add that content is broadening Beyond films and it's bringing new guests in and these people have different expectations as they watch live sporting events or video game or concerts but with that aside I'm going to focus on the cinema box the four walls what's in it and exhibitors service models to deliver outstanding experiences at Key moments of Truth along that Journey so the location is both where the building's located and its footprint and of course there's going to continue to be multiplexers out there but we're also seeing increasing numbers of smaller more Boutique High Street located Cinema sites and this has a bearing when you have a smaller site on things like the service model on this circulation space for queuing that pushes pressure onto other sales channels so less about over the counter and more about remote and self-service channels as these Cinemas come in and we're seeing a habit of of the drop-off being a little more step change than gradual at box office has a bearing on the auditorium sizes from a couple of gigantic ones dropping down to more modest ones now if you don't have that staggering of houses you've got to get your programming right you have to have your forecasting right and that leans into the sort of data science expertise that we provide we're also seeing outdoor Cinemas and this was a pre-pandemic trend for those of you who follow the industry might see one of the the flagship out of home uh Cinema providers out of the UK Secret Cinema just sold for about 100 million dollars so this wasn't a post covert blip around outdoor and that needs robust mobile technology to remain up and reliable through those those performances so that's the location but we're also seeing the offering what's in the box the configuration change we are seeing some massive you know generation one megaplexes of 20 plus screens reconfigure some of the auditoriums into family entertainment centers and those operators want a single view of their guests they want to know what movie they saw what what bowling game they played what meal they ate and speaking of food and beverage As you move into dining Cinemas there are whole new issues around ordering and food prep and food delivery these Cinemas have kitchens bigger than hotel banquet centers backlink kitchens but they have a fraction of the turnaround time to get all that food prepped and out so that brings a huge amount of complexity the technology needs to solve there are also expanded ingredients from alcohol and so on to manage the inventory and minimize waste in the cost associated with that for those of you who are familiar with Sylvia Park the Hoyts Flagship here they have a self-service candy bar you as the the customer walk through and pick everything up and pay on the way out now this model has been proven to drive net profit gains but it does have implication for theft and shrinkage so technology is needed to to minimize the theft that that occurs and and add every bit of incremental Revenue to the bottom line and then all of these Innovations all of these requirements need to be operated with fewer staff members and they're often less experienced so technology needs to guide these people through to provide consistent and outstanding experiences to their moviegoers as they go through the Journey So speaking of the journey this is a particular model that I've I've previously used and I'll take you briefly through each of the categories and and then elaborate on them so Inspirations long lead time it's sitting here now understanding that Ant-Man dropped a trailer yesterday for a movie that comes out in q1 next year and you're just starting to get that awareness of something you might want to watch months into the future look forward to anticipation now we're sitting here on a Wednesday planning to go and see Black Adam this weekend it's all about excitement who are we going with where are we going when are we going what are we going to do before and after what treats am I going to buy it's all the fun pass of planning that now comes crashing into Administration this is transactions Logistics courtesy cleanliness red tape and this is where the journey most often falls down from there you move into the auditorium into immersion now this is all about seat sound and screen and and the enjoyment of who you're with and what you're snacking on and after glows when the lights come back up and what happens next and so our role is to help our clients deliver delightful elements of the experience as efficiently and consistently as possible to minimize the red tape to hopefully turn that Administration into something less onerous like transition and eliminate the pain points it's to help Drive loyalty and lifetime value which is the product of frequency and spin and advocacy to keep the cinema as an incredibly vibrant form of entertainment and so if I take those those steps in turn Inspirations about linking the brand the cinemas brand to the movie in the minds of moviegoers as soon as the trailer drops and it's about capturing the intent to watch that Cinema that movie in cinema so it can be acted upon later anticipation's about maximizing Revenue by promoting the end-to-end experience it's the movie how to watch it what treats to enjoy and what to do within the four walls of the cinema before and after to maximize share of wallet and it's also about what what levers you pull pricing and other value levers when anticipation doesn't look like it's going to convert to visitation especially in the final days of a movie season in theaters you know as I say turning Administration into transition is a recognition that there's always going to be red tape and Logistics but how can you make that as quick and painless as possible this is really at the heart of what Vista does and what Leon and Cyril will elaborate on in a second it's how you use data and Technology to maximize efficiency and Effectiveness without compromising the experience it's using data-driven decision support and forecasting to optimize programming and Staffing and inventory and operating hours it's about streamlining operations and automating those elements that don't really impact upon the the cinema goer directly and it's about getting guest feedback on the service and Facilities to continuously improve the experience and delivery in in as near real time as possible but there are ways you can use technology if the presentation is right if the screen and sound isn't good if other guests are disturbing you because in a light labor environment going out into the access Corridor and confining a staff member to talk to can be challenging we can assist there and then Afterglow has two purposes one is at the end of making the end of a current visit the beginning of the next so understanding whether the movie you watched is one you liked and what trailers you intend to watch in cinema and the second element is continuous Service delivery Improvement so how do you use technology to measure and monitor Define metrics of service and operational excellence both in a passive way through what people transact and behave on and what they tell you yeah final click and fell apart hey so look I I hope this has given you a good overview of how our industry will remain competitive and relevant as a form of entertainment of film content but also of out of home Leisure and how will remain lucrative both on the ticket front and the food and beverage front and how it's going to evolve over the coming years and like this friendly point-of-sale operator handing tickets to a guest I'd like to now introduce Sarah's Sarah lothwaite movieo CEO who's going to talk about how our platform puts moviegoers at a tart Sarah thank you Matt I actually started my career as one of those ticket operators believe it or not many many years ago um thank you so much I'm here today to talk to you about why our decision to put moviegoers in the center of the platform strategy is the right one and how this strategy is delivering value in a study by McKinsey they learned that e-commerce adoption accelerated by eight years in the first five weeks of the pandemic and that new consumer purchasing habits had been crystallized and while this study spans several sectors we observed similarly changed Behavior with moviegoers purchasing movie tickets via Cinema run websites and apps has increased dramatically in the past two years at the beginning of 2020 the average percent of tickets purchased digitally was approximately 30 percent and you can see this via the purple line on the graph most moviegoers still walked up to the box office to transact but when Cinemas began to reopen in 2021 we can witness a dramatic shift to online ticket purchase Channels with now approximately 60 percent of all tickets being bought online we anticipate these new purchasing habits are not only here to stay but will continue to grow as e-commerce capabilities in the cinema sector expand and improve what we are also seeing in our data is that audiences are willing to return for the films that resonate with them not just for the blockbusters for many moviegoers our data reinforces that this best fit film will not always be a top box office earner believe it or not not everyone wants to see top gun Maverick looking at Q3 2022 data alone and the films that motivated someone's very first visit back to the cinema post pandemic we can see that 35 percent of moviegoers were coming back to see something other than a Blockbuster release this speaks not only to the importance of a diverse slate that Matthew spoke about but also to the importance of Cinemas connecting their audiences with the best films for each individual how and where moviegoers are engaging with marketing is also evolving in a recent study by HootSuite we learned that the average person is now using 7.4 different social and digital platforms per month spending an average of two and a half hours a day engaging with them connecting people to their ideal movie by the digital marketing channels where they're spending their time and creating a seamless digital purchase experience is now fundamental to the needs of moviegoers with changing moviegoer behaviors comes the expanding needs of our Cinema clients compounded by the growth of digital ticketing Cinemas have never been more data rich but at the same time in a challenging labor market and with several other operating priorities Cinemas have never been more time poor Cinemas want tools that take the guesswork out of their digital marketing strategy and they need tools that are proven to drive attendance and spend and we consistently prove this value with our clients the image on the screen shows a recent example of how a UK Cinema chain use muvio to predict and connect with audiences for don't worry darling and Mrs Harris goes to Paris mubio's proprietary algorithms did just this accurately predicting the audience composition for these films opening play week within one percentage Point muvio predicted that 24 of the city cinemas audience would find don't worry darling the best fit film for them and 25 of moviegoers was the representation of that share of attendance in opening week and muvio predicted that 28 of audiences would have the best fit film as Mrs Harris goes to Paris and looking at the audience breakdown it was 29 of attendance for that week as I said earlier connecting everyone with their ideal film isn't just about supporting the Blockbuster titles this UK client saw the tangible value in using muvio to connect their audiences to these two smaller releases delivering a highly relevant moviegoer experience while also driving attendance this is just but one example of how we at Vista group are ready to respond to the changing behaviors of moviegoers and the changing needs of Cinema clients our decision at the start of the pandemic to Pivot and focus on developing Vista digital and muvio EQ was the right one this was a very conscious and deliberate strategy on our part Cinemas needed modernized websites and apps to meet the changing needs of moviegoers and Vista digital delivers just this providing our Cinema clients and ultimately moviegoers with a cohesive reliable and frictionless digital ticketing experiences experience our clients can see who purchased tickets well ahead of guests arriving at the cinema allowing them to upsell or cross-sell concession items premium experience or even just operationally knowing how to staff their lobbies which are some of the ancillary benefits that clients enjoy by moving to the Vista digital platform and at muvio we reimagined our decade-old movieo Cinema product to be faster simpler and smarter for our clients we anticipated that Cinema marketing teams would be stretched and that are now data rich clients would be relying more heavily on their databases and their digital marketing tools to turn data into insights insights into highly personalized marketing campaigns and campaigns into meaningful bottom line impact and hence movieo EQ was born muvio EQ has been in its Alpha phase for the past six months but I'm pleased to announce today that muvio EQ is now live in beta with three European Cinema chains this next phase of our products Evolution marks an important milestone for muvio and for the Vista group platform we plan to accelerate the migration of all muvio clients from their current movie of Cinema product to movieo EQ over the coming months and year and I look forward to sharing how our migration progresses and providing insight into the additional bottom line benefits that both Vista group and our clients will glean as a result the Vista group platform is uniquely positioned to deliver the solutions our clients and ultimately moviegoers both want and need it improves the guest experience at every digital touch point prior to the platform moviegoers were at risk of not getting tickets to the films they wanted Cinema websites were often disrupted with high volumes of online ticketing for key movie releases today Vista digital offers reliable highly available Cloud infrastructure which scales as transaction volumes grow ensuring business is uninterrupted and providing a guest experience that does not disappoint previously the moviegoer experience was also fragmented a moviegoer could log onto a Cinema's website and have an entirely different experience from that of the Cinema's app to that of the Cinema's digital kiosk but now Vista digital provides omnichannel components including revamped seating maps and pricing logic ensuring a consistent and unified guest experience at all purchase points and our new World guest experience is powered by data unlike in the old world where personalization was limited to specific channels or based on a handful of data points the platform provides personalization capabilities not only through marketing channels but also by digital sales channels allowing for more sophisticated customer Journeys smarter multivariant offers and marketing campaigns that are fully integrated this includes AI driven recommendations at all touch points Dynamic content and the ability to reach moviegoers where they're spending their time across more social and digital channels the combination of Vista digital and muvio EQ is the unbeatable combination of digital marketing tools for Cinema clients and for moviegoers alike by putting moviegoers at the center of the platform strategy the platform becomes Mission critical we deliver a better guest experience driving more digital transactions which is beneficial to our Cinema clients while simultaneously growing variable revenue for Vista group through our top-notch digital tooling we will help our clients amass even more data allowing them to leverage this data to drive attendance and spend but also at the same time providing the building blocks for future platform extensions by putting moviegoers at the center we are ultimately increasing our relevance and our strategic value with our clients we are Partners in their success by understanding the needs of the end consumer we solve the needs of the cinema industry and we are amplifying the opportunity for Vista group so now to tell you more about what that transition to the platform will look like I'd love to introduce Leon Newman CEO of Vista Cinema thank you very much thank you very much Sarah so hello I'm Leon I'm the Vista Cinema CEO and I'm here today from Los Angeles to tell you a little bit about our terrific clients who are Cinemas all around the world so for those of you who aren't as familiar with Vesta we run Cinemas in approximately half of the world outside of China and here's just a small sample from our client base a few local names you might be familiar with like event and Hoyts and Village but also some of the more prominent names in cinemas worldwide like pathway France Cinemax Cineplex Canada vista's client base range from smaller more modest theater chains all the way up to theater chains that spread across multiple countries and you heard about a few of the concepts there from Matthew it ranges from traditional theater all the way to dine in and Rooftop Cinema bowling alleys all of that is run with vista's Mission critical technology to serve those guests but what I'd like to share with you today are these Hot Topics which are emerging As Natural platform value drivers so before I dig into each of these topics and how they have relevance to our platform what I'd like you to keep in mind is that whilst each of these will have a different degree of urgency for any particular Cinema chain in aggregate what we see across each of these with the possible exception of constrained labor is it the urgency and momentum is only increasing so as I talk about each of these for example cyber security it's more of a concern today for a theater chain than it was yesterday it'll be more of a concern tomorrow okay so the momentum is increasing so to dig into constrained labor yes theaters are having trouble with their guest facing staff they have constrained labor there the platform does a great job of being able to modernize digital channels allowing moviegoers to self-service but it's not really just limited to that theater Trends are also having issues with the it departments being a little more modest and skinny coming out of the pandemic they're probably looking for a more compressed list of responsibilities you heard Sarah talking about the marketing team being time poor muvio EQ does a terrific job of allowing a Time poor marketing department to engage with moviegoers so we do a great job of uh checking that off with the platform in terms of the stability of the digital channels this has always been an issue for Cinemas they see this huge spikiness as these tent pole releases come out you know maybe to some degree with Black Adam but definitely for black panther 2 and Avatar 2 they'll see this massive massive Spike maybe a hundred times the level of traffic through their digital channels compounded by the fact that ever more people are looking to transact online in general so you saw the stats there there's more people looking to buy online so they're buying their tickets that's been an upward trend for a while but now they're also looking to pre-purchase their concessions and some theaters are looking to experiment with service to their seat so maybe they skip the concessions counter and you're pulling out an app or a website and you you've got to start them by bringing that to your seat and so there's this great desire for digital channels to be modernized to be stable and scalable and to do more there in terms of the understanding of the moviegoer this has been a constant trend for a while but now more than ever Cinemas are looking to understand their moviegoers their tastes in some cases trying to get them to come back to the movie theater post pandemic the media EQ portion of the platform does a great job to address that in cyber security you know I think this part of the world has had a real refresher in this over the last month or month and a half theaters sit on top of millions of records for loyalty members pii data that with our on-premises software lives on service that the cinemas are responsible for no Cinema wants to end up in the herald Sun or the age as being the latest breach with that pii data going out the door okay so cyber security is absolutely a concern that's on the rise and then the removal of cost and distraction which dovetails beautifully into this last Point Cinemas want to be focused on the movie goer getting to come in the door giving them a great experience probably increasing their per spend and not focused on the technology and uh let's just say that the running of software rather than using it now our on-premises technology doesn't do such a bad job of addressing some of these points but because of the great list of responsibilities that we put on our exhibitors with our on-premises technology there's a whole barrier between them and unlocking that value and that's what this looks like here on the left side here you see our on-premises technology we deliver it and then we pass it over the fence to the exhibitor who then must be responsible for purchasing the server Hardware the operating system the database licensing the database maintenance the security monitoring it for any outages this is software that runs almost every element every transaction that goes through these Cinemas they cannot afford it for it to go down and so all of those stand in the way of taking the very latest Innovation that we have on offer and putting that in place maybe engaging with the business to work out how to unlock more value in the eyes of moviegoers so it's all about running our software and not necessarily about using it and unlocking value on the right side this is a huge shift in responsibility all of the I guess the responsibilities of ensuring that this application runs and all of those latest value drivers are available all of that really shifts quite solidly to the right and so if you take a look at what the world might look like it should be night and day exhibitors are focused on looking at our technology how do we use that to bring more movie goers in are they having a good time how do I Target them better better understand their tastes not worrying about whether or not the latest OS security update has been run or not you see those responsibilities shift to the right hand side and that's reflected here the commercial model is completely different from the left to the right so on the left side you can see it would make natural sense you have that upfront Perpetual fee and an annual fixed maintenance we have a relatively modest core with additions like muvio and other modules from Vista should they choose those a la carte but you can see there that the responsibility is so much on the exhibitor to keep the smooth running of this software happening on the right side we take far more of that responsibility you can see that transfer that share of wallet where those that cost and that time shifts from the left to the right you can see there that our fees will vary based on the box office performance this is really exciting for us we want to see ourselves aligned with Cinemas we want to be really excited about not just delivering software we want to see more people going to the movies and so we achieve that there our fees will vary up to 80 based on the performance and so we sort of uncouple ourselves from thinking about this in terms of software and Licensing and we think about enriching the core providing everything that we believe our modern forward-facing Cinema would need to maximize their success so we're looking at putting as much as we possibly can in there around analytics targeting moviegoers movieo EQ is included so there's that real shift in mindset so as we take a look at our client base it's difficult for us to understand for any particular Cinema chain when they might make this transition but it is just a matter of when and not if and we offer the platform in two flavors the first is cloud digital and muvio EQ what this sounds like is somebody will call up and say hey Leon I'm looking at our digital channels I really want to amp up what we're doing there I really want to ramp up how we're engaging with our movie goers but we're relatively happy with our server estate we've invested through the pandemic we don't need to replace that there and we're reasonably happy with our cyber security posture but what can you do about cloudifying and injecting more Innovation digitally that's this first option okay it's the first byte into the cloud onto the platform but you still have a lot of that technology running on the servers until you take that second step so this is the full Suite Cloud cinema this is where we take away all of the servers all of the maintenance and so much of that cyber security burden will shift across to us and so what we're targeting is 1600 to 2400 sites on our platform across these flavors by 2025. so underpinning our platform is a whole host of amazing technology so we have an amazing technology person Grant Smith the CEO of Vista Cinema to tell you a little bit more about it for all the clothes thank you Leon very good yeah so um you've chosen to come to an investor presentation by a technology company so unfortunately you cannot Escape without listening to someone get a little bit nerdy about software and technology so that's what I'm going to do I am going to try and keep things brief though and to the point today I'm going to explain how Transforming Our technology platform is going to unlock critical operating Leverage Drive demand for adopting our Cloud solution and eventually unlock new opportunities and Partnerships for Vista so as Leon mentioned Vista is the core system of record for over half of the world's Enterprise Cinemas but let's think about that for a moment every single transaction every ticket sold to every movie guy at those Cinemas is powered by our technology our software needs to be there we estimate this equates to around about a billion tickets processed through Vista software every year movieo platform now connecting some 40 million active moviegoers around the world with their ideal movie it defines the gold standard for marketing teams in our industry and as Leon pointed out we have Global coverage we're in over a hundred countries and this is no small feat in some 35 of those countries our software has had to pass rigorous and time-consuming homologation testing to achieve compliance you combine all this with the fact that we've not stopped continuously enhancing the functionality of the products for over 25 years and you grasp how significant that technology and know-how Motors that we've established so this is a great place to be but we are not complacent we have sought to disrupt our own Market with our own Cloud solution just to be sure that we're still leading this game in 25 years from now so with cloud our goal is to go from providing the most trusted software products available on our Market to providing the most trusted platform of services taking on much more of that technology burden that Leon's outlined and we've approached this technology Journey from on-prem to Cloud progressively we focused on what mattered most to our clients and we got a solution in their hands as early as we could and the journey really started for us about three or four years ago we took on our first managed service clients but then at the start of this year we've gone live with the first iteration of Vista Cloud a true software as a service offering and this Progressive live and learning approach has allowed us to road test and fine-tune both our software but also our operational processes to be sure that we can deliver the very high quality of service that's demanded of a business critical platform that we offer and we've been successful all of our foundation clients on both our managed service and Vista Cloud offerings are continue to run and indeed Thrive successfully they're very happy which is great throughout this journey we'll also maintain a single code base across our product Suite this means we continue to leverage our r d investment efficiently with every dollar spent building new capabilities being available to benefit both on-prem and Cloud clients and this has been an important key to ensuring that we can continue keeping our on-prem clients happy even while we're working on our Cloud future state that they will all move to over the next few years another point I want to make here Vista cloud is not a stripped back or lightweight version of Vista it delivers the full breadth and richness of the product Suite in this first release now this means broad Market fit across our client base and it helps to simplify the transition equation from on-prem to Cloud for our clients so this is the Vista Cloud Foundation we're launching from we have Road tested and proven the reliability of our solution and our operational capabilities and we've captured 25 years of functional breadth and make made sure that's available out of the box so we're in a really strong position to launch from but we now need to take the next steps on our technology transformation Journey now I have tried to distill a Litany of project plans and Gantt charts down into just one slide for today so I'm only going to highlight the key deliverables and Milestones currently our live Cloud platform is probably most simply characterized has been a single tenant architecture when we onboard a customer we have an environment per tenant which we must provision and then continue to feed and water now this is actually an oversimplification because products that were beaten built in the last few years and the infrastructure and platform services that underpin our products are in fact multi-tenant so it's actually a hybrid environment but for the sake of Simplicity we're going to call it a single tenant iteration at this stage couple of other characteristics to call out as mentioned we have full functional parity in this iteration and we've built up robust Automation and observability to assist our Ops teams our Ops teams and that helps to balance the scales a little bit for the single tenant environment but needless to say with this architecture the net result is a greater dependence on person power than we really want and we need to overcome that to be able to scale so we have some work to do for our next iteration aiming toward the end of late uh 2023 will deliver true multi-tenancy across our digital suite and muvio EQ now this sequencing again aligns with the digital first strategy that Leon and Sarah have described and again this is about focusing on what our clients want most digital Suite includes components like a online sales apis and services our white label sales channels web mobile and kiosk online payment processing and content delivery platforms so for any of these components and services that aren't already modernized they'll be upgraded into what we refer to as a mature SAS architecture now that term covers a number of different characteristics but the standouts are multi-tenancy and deployment using containers rather than virtual machines okay now this multi-tenant container-based architecture delivers some really important benefits firstly the management overhead of looking after one multi-tenant environment with hundreds of clients in it as opposed to um hundreds of environments is obviously just a much simpler set of overheads in terms of cost for us to incur both in terms of sort of infrastructure costs as well as person power containers unlike VMS they're designed to scale up and down elastically so this means we can scale up quickly making the platform more resilient resilient under spiky load as we've talked about but also it means we can turn the lights down again when things go quiet and run much less expensively which you know happens a lot in cinema too containers are also much higher density than virtual machines so they're simply less expensive in terms of compute and memory costs to run and we also get faster deployment and better automation support so onboarding is less work and more predictable so combine all those benefits together the outcome is the ability to onboard digital clients much more quickly than we can today to a much greater scale and a cost efficient way a few other things to call out in this iteration will be extending our app analytics coverage allowing us to research new ideas that will generate Cloud Envy critical for the later stages of adoption and we'll come to that we'll also be expanding our offline support so offline capability is an essential component in our success offering unfortunately things go down including fiber cables and data centers and sometimes even our software but we still need movie guards to get their seats and they need to transact so we provide offline support in our point of sale for the most critical sales functions and this will continue to be a crucial feature for us finally we'll be delivering the first release of our extensibility platform so Vista has a long track record of supporting extensibility for our clients through various plugins and data in and data out Integrations and these will all be ported across to a purpose-built API platform that we can control and monitor and monetize okay so iteration three toward the end of 2024 we'll see the next tranche of multi-tenancy and containerization delivered meaning the same benefits we've unlocked in iteration 2 for digital that operating efficiency and the ability to onboard scale and this now applies to clients adopting the full Cloud Suite so also on this iteration the implementation of a feature flagging feature flagging is really important it allows us to release new code into a live environment in a controlled way allowing us to turn on new code Pathways but an important to turn them off again and this gives us the power to rapidly but safely deliver Innovation and value across a multi-tenant platform and again an important foundation stone for the iteration which comes after this additionally here we'll be maturing the extensibility platform that we've created previously into a burgeoning Marketplace offering so this here was a truly new way of working with Vista our clients will benefit from an ecosystem where our core platform can be extended in new and innovative ways without Vista needing to be part of that critical path so this means greater Innovation and access to Innovation for our clients but also opens up new Partnerships and opportunities that Vista can benefit from finally in this phase we plan to complete the transition to move your queue for all our movieo classic customers again enabling ongoing rapid delivery of new features and capabilities but also exciting new synergies between Vista Cinema and movieo products sorry excuse me okay a lot to get through okay finally iteration four we see all our remaining products and services modernized into that mature SAS architecture but this phase is also about generating Cloud Envy to entice slower moving clients across the Vista cloud with the foundational work I've described completed in previous iterations we expect to see vista's Leading Edge and product Innovation really start to pay dividends a year our remaining desktop management applications will be migrated to the browser so users will be able to work from any device and will be will be unburdened from the overhead of having to support that Legacy technology also I know roadmap here is the release of a lightweight non-windows point of sale to Market now this will dramatically reduce hardware and Licensing costs for our clients which we believe will be a major attraction across the platform okay so when we reach this phase we have modernized our technology stack into a highly scalable cost-efficient SAS platform delivering operating Leverage and the ability to onboard clients at scale we also have a platform which allows us to deliver Innovation rapidly generating demand and encouraging later stage clients to migrate but also importantly attracting new clients to Vista cloud and finally with a rock solid platform in place and clients onboarding at scale our Marketplace will create an ecosystem for New Opportunities and Partnerships to flourish it's an exciting place to be I can tell you I've described the Technology's journey ahead of us here but none of this transformation would be possible without our people building toward a future state that looks like this is what really excites them to being able to see the hard work and the Big Ideas that they have and the work they do today deliver real value to users tomorrow that's a Nirvana state that they really want to attain so while this roadmap is designed to reach our business goals it also describes a really vital North Star for our people and we certainly can't achieve this without them so on that note I'm going to hand over to Anna who will talk more about our wonderful people thanks Grant and hello everyone so as Grant mentioned I'm here to talk about our people and specifically to talk about how our people are at the heart of our success as we talk about expanding our platform it's our people who are going to help us get get there it's our people that build the platform and it's our people who will support our clients make the transition to the cloud however ensuring that we continue to attract and retain great talent to achieve that objective is also one of our key risks so having the right people with the right skills to support our transition and our growth is something that we are actively focused on we have a great Foundation that we are building on and along with a number of specific measures to help us address those key risks so first of all as Kimball mentioned right up front one of the distinguishing features of Vista is our purpose-led culture we are passionate about our industry and I'm sure you've heard it through some of the discussions I'm here today and we're passionate about the role we play in bringing more people together to experience the magic of movies and as Grant has alluded to just now our strategy has enhanced this sentiment in moving to the cloud it's enabled our teams to be at the Forefront of innovation for the industry and presents a great opportunity to partner with our clients to drive that success second is our Global reach as a truly Global business our team now spans more than 750 employees across 12 countries and it means that whilst there is a distinct Vista culture there are also local cultural nuances in each location this is something we both encourage and celebrate harnessing what we share as a collective as well as embracing what we can learn from each other's unique perspectives and experiences but being Global also means being close to our clients our team particularly our sales our implementation and support teams are distributed around the world this helps us build deep relationships with our clients to understand their needs their local context and culture as well as ensuring we can be responsive so as we transition to being a cloud-based SAS organization there are also necessary changes to the skills required within our organization and whilst new capabilities have been introduced and developed within our software engineering teams as we've been building the platform we are now also developing new capabilities and structures in our implementation and support teams this has provided some exceptional growth and development opportunities for our people but we also have to bring in new capabilities from outside the organization with a strategy of deliberate and manageable growth over the course of this year we have significantly ramped up our recruiting activity across the business in the context of a tight labor market we've deployed a range of innovative strategies to ensure that we can attract those new skills we need into the business as well as retain our existing Talent on the recruitment front we have adopted multiple channels for sourcing and engaging Talent we're using digital platforms including campaigns on tick knock Tick Tock and Instagram as well as more traditional channels such as LinkedIn strengthening our brand and our reach into the market we've identified those roles and skills that we need to engage as permanent hives and those that we can engage on a contract basis to enable us to scale up more responsibility responsibly and we're building real momentum in this space we leverage our Global footprint and can cast The Net widely when we're looking for talent for example we're engaging technical Talent across the world to ensure we can meet that demand we continue to identify an employee from diverse Talent pools including working with a range of Partners For example hire her and tupatoa here in New Zealand and finally we have a strong internal Talent Pipeline with our extremely successful intern and graduate programs that support our needs both now and for the future on the retention front we have a strong Legacy of looking after our people and keeping employee experience at the Forefront this approach has been vital to sustaining our culture for example implementing our employee share scheme in 2020 and more recently our four and a half day work week which was introduced in 2021 we pride ourselves on our top quartile employee net promoter scores and we encourage regular feedback from our people to ensure that we're responsive to the issues that matter most finally I want to acknowledge the challenges I've already mentioned the tight labor market but we're also not immune to the rising wage costs we've had to address wage inflation by appropriately lifting salaries to ensure we can both continue to attract and retain our people we also provide a range of non-cash benefits to our people which sets us apart from our competitors and are valued by our people this includes everything from our share scheme as I mentioned but also insurance benefits through to regular movie tickets and movie Nights and finally we continue to grow in low-cost locations such as Mexico and South Africa which has proven to be a success not only for our balance sheet but for our clients and for our teams All In All We believe We have the right strategies in place to manage the challenges in front of us and we're confident that collectively we'll be able to reach our strategic goals so now I'm going to pass over to Matt Court how to financial officer thanks Anna so thanks for your attention so far and coming on the journey with us I'd like to Now sort of distill all of that transition into what it means financially for us um as we go a little bit on this journey and accelerate into it I've said it many times before and those of you met me in time many times during the pandemic we're actually in great shape but it's not simply because we've got cash on our balance sheet and the whole purpose of today is to really emphasize uh the depth of the leadership team in front of you the understanding of the market and the opportunity that we've got there to take advantage of so we've worked solidly through the pandemic to put us in the best possible position that is financially looking after our cash but looking after our customers we talked about it a lot we raised Capital early on in the pandemic and the benefit is being felt today right I don't know if any of you remember the uh our first half announcement in 2020 I certainly do slightly scarred from it okay but we talked about what we needed to do we head raised cash at that time and what we needed to do to shape the business to come out of the pandemic in a way that we thought our clients would need us and if you go back to that you look at the transition we we marked at that time into the digital space the evidence you're seeing today from all the team is is the output of those decisions we made early about our clients and about the industry and the industry we understand and how we wanted to come out of the pandemic in terms of supporting them not saying we got everything right but we certainly certainly got the majority of our decisions shaped up nicely and you're seeing the evidence of the technology investment structural investment the people and we have investment come to play now so thank you for those who put your money in um I think we're repaying the faith in bounds now and we're really happy to put our our stake in the ground for where we are now and what that means for accelerating from here on in but before I go into too much of the numbers I do want to talk about some of the macro industry uh influencers and what that means for Vista um as a team first of all um on the left the macro Factor so certainly Matt leedman talked about the strength of the box office it's not at 100 right okay but we've seen a good Pathway to the a strong sentiment for moviegoers coming back and the box office will follow with more movies and diversity of movies however we must recognize that some of our clients are still you know got some heavy balance sheet issues to address okay we're excited that they've made it this far and even though the last couple of months have been a little bit light certainly the outlook for twin the rest of 2022 and 2023 is all about cash over the tools for them and the if they've made this far it's about um uh propping up their balance sheet and looking forward so we're in good shape there um we we do recognize though that some of them have issues and we're obviously monitoring that all the time um inflation costs and the op and potential for a recession a global in different parts of the globe certainly we're facing front on but assess Matt talked about we're not Recession Proof perhaps but we're recession resistance in industry and traditionally the industry has done really well so in terms of making our plans we're very conscious of that we've touched on Talent as one of our risks along with cyber security there are two risks that the management team take very seriously we take them very seriously internally and the influences that that they have on our clients to affect the way that that they will move towards the platform hopefully that was key to Leon's message so we are not immune to those things but we are actually able to really leverage those opportunities to help our clients perform going forward so lots of macro effects and in terms of micro we're going to get back into Market size growth next year and market share growth with Market size growth Vista traditionally has been on the right side of benefiting from that simply because of the type of customers type of clients we have we expect that to continue next year likewise the headwinds we've got with wages we're off setting with Progressive price increases where we can I think there's going to be I've talked about it in the past I think there's going to be some short-term influences but certainly in the medium and long term we're going to be able to cover off uh price increases from Vista and as always Focus very seriously on cash and where we spend it nothing's going to change in that space so what does that mean for the business model and our transition to the platform really the maths the model is quite simple our Revenue growth will be delivered by an adoption curve time of price largely per site or per circuit plus the growth opportunities Market size and share growth and expansion and other value-add opportunities which open over and above the platform okay as we gain through as we work through that adoption curve we also get progressively delivering operating leverage so that's sequential delivery of operating leverage will happen and I'll talk to about it in details as we go through the next three years as we go through those inflection points and deliver ebitda and free cash flow what is exciting for me is to reassure everyone here that we don't need any more funds to deliver on our short-term on our long-term objectives just diving a little bit more into Revenue the importance of the adoption curve is high here so s Leon outlined we think based on market demand today that we'll be able to achieve between 1600 and 2400 uh sites by the end of 2025. it will be variable based on market demand Perez uh s Leon talked about it all of the value drivers that are affecting our clients today are accelerating they're not decreasing so we feel in a really good position there what we're facing today and Kimball and I have talked about it in the past is being a supply constraint in terms of deliver our delivery capacity to convert clients the investment we're taking now in Grants team and with our support team across the world is to unlock that opportunity and obviously with adoption the other bit of the math is price previously we put into Market in 2020 2019 that we would be one and a half to two and a half times and maintenance when we go through the transition we now think that when you look at the the transfer of responsibilities and and the future that we're looking at that it will be between three and five times and that will depend on a bunch of things for each of our clients okay but we're at least three times multiple and for us that's very exciting it opens up a larger share of the wallet okay but with it comes a lot more responsibility so when you marry the the donut graphs that Leon put up in terms of the transfer of responsibility and our upscaling of our capability you meet the opportunity that we're facing and we want to put down today that our ARR for 2025 if we hit these targets we're between 175 and 205 million that's an AR growth from here on in between 15 and 20 consistently over the next three years with that adoption curve we obviously are able to drive that sequential operating Leverage and we will begin to build momentum on that operating leverage from 2023. so we have in place or we'll have it in place at the end of December roughly the the sales and marketing organization and the g a organization necessary to deliver the full platform so we'll start to get some leverage from that next year as we as we have full year costs we have a short term increase in our r d function up here we call it the the capitalized development bump okay that is a total spend of 25 to 30 million dollars over the three-year period 23 24 25. this is over and above the current run rate of capex okay with that we unlock the faster onboarding and the breadth of service um and we get closer to the network effect of the platform that Grant was talking about after that we'll track down to an average spend of about 15 million dollars capex which we've been on a run rate for the last couple of years our cost to serve model which is mainly made up of two key components first of all the hosting costs and the support organization behind that will always be very heavy for the next couple of years we're talking about transitioning billion dollar organizations onto the platform so we need to run across 24 time zones 365 days a week so we're not going to go light in the transition on how we move our customers across we're going to always have at least until all the engineering is done a really reasonably high cost to serve made up of hosting in particular however the support organization which is also a significant part of our costs that we will have in place by mid-23 Will largely be that size which we need to transition the entire client base across So after 24 we're likely to see some incon a consistent improvement in our cost to serve at the end of 25 we expect to exit with an ebitda percentage around about 15 on the way to 25 to 30 percent ebitda margin where we've converted 100 of the market and graphically since we're all graphics chartists in the room this is what this looks like and we use the 2025 as an anchor point because we see s Kimball started the presentation with the inflection point from the end of 24 rolling through 25 onwards and so in terms of measuring ourselves 2025 is going to be a very important year for us because the flywheel effect of the of and network effect of the platform almost make the end point they're not inevitable but more and more likely the value proposition becomes clearer to our clients and our ability to deliver it becomes easier that's why we've called it an inflection point the business will always have a base level of non-recurring Revenue as well on top of the ARR we've talked about but as you can see transitioning through that inflection point we move to a majority of the of the revenue of the business coming direct from the platform and 300 million ARR is our base Target there are lots more opportunities that once we have those 1 billion transactions that exist today in data islands around the world in one data pool we open up a lot more opportunities and and then we've we currently can and then we currently can see and Grant talked about the marketplace opportunity that may or may not deliver a massive economic benefits but it's going to deliver massive client benefits it will open up new ways of marketing that we can't see new wave payment models new ways of integral interacting with moviegoers that we can't quite see it none of that is factored into our 300 million dollar set is simply getting our existing customers onto the platform for some some share growth what is exciting is what that starts on the right is just the graphical expression of the adoption model flywheel kicking in and us being able to deliver significant improvements to our operating leverage driving ebitdara and free cash flow from 2025 onwards I want to reiterate here we have a good balance sheet we've looked after it well and we don't need any more money to execute on our existing plans okay we also you know on the platform as we gain momentum on the platform expect to get improved receivables management so there was some actual other balance sheet benefits to the platform as well but from the capital allocation perspective the short-term capex as it rolls off plus the inflection point we'll deliver free cash flows in 2025 onwards available for further Investments or dividends we do expect though over those two Financial years our financial year 23 and our financial year 24 to use up some of the cash we have on our balance sheet today and at the moment we forecast that to be about 25 million dollars across the two years so in summary the inflection point and Beyond is really important because of the way the business model will work the more we can bring into the onto the flywheel earlier the sooner we are able to accelerate out of it so here are some of the touch points that we've talked about to the market previously and how they've changed and I just want to draw attention to a few of them the key ones being that the multiple which I must admit is a is not the best way to represent the way we look at the market the way we look at our clients as well but it is simply the easiest way to communicate it to investors at the moment okay in the future I look forward to being able to talk about the value proposition in our the percentage of value we create for our customers and how we take that rather than the historical reference of the maintenance portion of Perpetual model at the moment until we've got enough rubber on the road in terms of the cloud options and being able to talk about the commercials I think the main the maintenance multiple is the safest place to go at the moment but when you take that multiple and our arrr attack us you begin to get a feeling that we've got a lot of opportunity ahead of us to take in the end the transition will deliver significant and sustainable returns that's why we're driving ARR we don't require funding we do have some cash to spend in the next couple of years we've signaled that to the market it's a little bit more than what we've signed before but I think the size of the prize is much bigger and we're forecasting where that our aspiration is to deliver free cash flows for investment and dividends from 2025 appointments I'll hand back to Kimball to round out the presentation thank you uh thank you Matt um just just a brief comment um for those of you who thought that Anna was about to lose her voice in fact she is about to lose her voice and we had to kind of crowbar her out of a sick bed to have her here but I'm very pleased that she uh that she did come up I just wanted to reiterate before we go to questions um what it was we set out to convey today so firstly and I would have talked to this Cinema and Theatrical experience is in really good heart and with considerable upside more movies more breaths of content and increased differentiation and of course you can all Play Your Part go to the cinema okay so like pretty simple off the sofa into the cinema thanks very much secondly the platform we're building offers our clients the best experience in the industry and we will keep improving it our motivation is really clear we want to continue to be the best in the world at what we do and our platform will sustain that for us for our clients and for moviegoers and you might have just noticed I said something there right we are the best in the world at this the evidence supports that and we are going to continue to push that our engagements with our clients are strong and our value proposition is clear and having an inflection point in the late 24 is really exciting for me that we can start to look to generate free cash flow in 25 and onwards as I noted given all we have been through both our industry and our company this would be a fantastic achievement I want to thank you for your attendance and for your attention today we'll just give us a couple of minutes to arrange ourselves and then we'll start to take questions okay [Music] so we're going to take questions from the room first but just before I do I would like you to reflect on the diversity of our team there are three Australians one Canadian and three new zealanders okay so uh any questions on the road I'll start over here sorry I'm just working away but yep oh sorry we're going to give you a microphone um you're just a quick question for Matt just um on the cash burn forecast that 25 minutes a bit higher than what I was forecasting is that due to higher capex is that the main reason and is that due to what you're saying in terms of trying to accelerate This Cloud transition uh yeah it's driven by two two factors the capex is one of them uh but the short term uh wage pressure for next year in particular is the other key factor so it brings into both of those uh both of those vectors thanks Stephen yeah thanks um just on the 300 million dollar ARR Target um you know you sort of said it's when you get to 100 platform just interested in your thoughts as to a potential time frame I know it's difficult to predict at this point but just your thoughts potentially how long it could take and then other examples where you look at other on-prem software companies that have made that transition you know how long that Journey has taken them as the case studies would be would be helpful um we have deliberately not said when um and uh even though I'd like to be able to say something to you I'm not going to I'm not going to go over the my own bounce Brit there at the moment um I think what I would say is that once we start to see as mate describes it the flywheel um my personal perspective is if we end up with a handful of customers who are still hanging around on premises because frankly they and I can say this because there aren't any customers in the room because they can't organize themselves then that's not a problem for us because we will also be continuing to expand market share right and so I it doesn't worry me at all right that that might be the case I mean we won't be delivering a whole lot of value to people who stay on premises and four or five years time all right but um uh there's not a kind of a I guess from my point of view not a specific point and I'd I'd rather focus on the inflection point than than the end point if that's all right Stephen can I add to that one I think so in terms of modeling the 100 is is an aspiration will be great and I don't have many examples of people who've come other than shutting off their Tech um we do absolutely believe that the majority of the market will have moved in 26 and 27. so in terms of our burden for ongoing support and all those kind of things even today it's reducing because all the tech and all the functionality we deliver today is ma is largely uh digital and Cloud first so but the heavy lifting of the business will be done 26 27. thanks and maybe just uh one more question so in terms of the three to five times kind of Revenue multiply which is you know a bit more positive than you were you know the August result and previously indicated just can you give us some some confidence at least that you seem very confident the low end of that range in particular uh presume that it's kind of what you're already saying give us a little bit of flavor as to as to you know what's giving that confidence and are you saying that that that buy-in across your customer base um both large and small customers in terms of The Upside there uh yes I'll I'll have the first um answer so I'll answer from the model perspective and how we see the total Market but then I might just pass to Leon to talk a little bit about it his experience and sort of General rather than customer specifics but certainly as we've one of the beautiful things about our business is uh we have lots of little pockets of of Genius in in some of the smaller products and that kind of thing but actually we have basically 300 customers who run Vista Cinema globally and they are the people who do the billion tickets through their on-premise data Islands um as we model how uh what we need to do to deliver this sort of transfer of responsibilities um we we see lots more opportunity of uh um upscaling our services quite frankly and therefore the opportunity uh in terms of the multiple and if you think about the multiple is that we're delivering more services and first and foremost right um but we're also it's about capturing the value of those new Services versus the value of a maintenance model which is the value of a transaction they may have done a while ago so the further we've gone into it the closer we've got to the customers which Leon will talk about and because it's worth laboring it as a very important part of our our future is that we just see lots more upside as we take on more responsibility Leon do you want to talk about our experiencing that was that question from you Stephen yeah so great question uh yes we've tested the market when we set the initial expectations around that multiplier of 1.5 to 2.5 quite a lot has changed during that time frame um if I were just to pick out for example the cost of server Hardware if you try and pick up server Hardware in the middle of 2021 you would see fire in excess of 20 30 40 growth in in the cost of that Hardware um or you take a look at cyber cyber security Insurance the cost of that for a circuit for many of those circuits they've gone from three potential providers down to one and the cost of a Windows based endpoint to secure that is far more and so we don't particularly sit down with our clients and take a look at what they are looking at for our on-premises and then lay out our cloud and platform Journey it's completely different we're really looking at that total share of wallet and spend and if you take a look at the list of what's in that column there that's all about cyber security Hardware um you know running updates and database licensing and that's changed significantly just during these period between the the multiplier um and yeah without naming any clients we're seeing positive results in that in that multiplier range um but our pricing is not at all based on being anchored to what those on-premises costs are yeah okay any more questions in the room I can see one back here hello uh Brittany from spheria so two questions I had one is just General on wage pressures um what are you seeing can you give some guidance on percentage-wise and whether you feel like that'll abate how would you like to yeah sure thank you um so what we're saying is it is it does differ around the world and so we are looking at that um on a on a local level in each market we also um believe that that's going to ease over the course of the next 12 months so we're looking at a way that we can both um make the necessary adjustments through our annual remuneration review but also look at different options around how we can support our people through what we recognize as really important cost of living pressures that our people are facing and so we're without going into too much detail about how we're managing that and we feel that we're getting the balance right and that's going to play through over the next six to 12 months and you had another question [Music] um you call out the market share gains I'm just trying to is it you know China and India or is it your current markets where you think you can get to that 60 plus uh primarily uh the the markets we're in it doesn't doesn't include China and India I mean we have a good market share in India um China is a kind of a special case of its own but then across Europe uh in Latin America in particular will be the two markets I'd call out there uh thanks very much guys just wondering if you give some color on what your capacity is to onboard these guys so if you did get demand slightly higher than you expected you talk to you know 1600 to 2400 by December 25 but how how quickly can that be scaled up um I'll hand that to Grant I think sounds like a grand question to me sure we're going through the process of onboarding at the moment so we're learning a lot along the way and figuring out our capacities um quite cleanly but um look I think the equation that we're balancing is between technology and people and so uh while we're scrambling as quickly as we can to improve the technology state so that we can import and Achieve that scale um in the interim we have lots of good people uh 750 of them in fact so I'm going to start asking Anna to onboard customers if we get a massive flood of them coming through if we can take that on um so yeah effectively we have plenty of great people around the world who are capable of taking on this work so we've got plenty of personal power if we need to call on uh I'd add to that a little bit and that over time it will our ability will accelerate because it will be much more efficient data right um and one of the key factors that the guys have uh determined already is that it's not necessarily the scale of the circuit right it's the number of circuits so if the sales organization is capable of bringing in the bigger circuits earlier right it doesn't have the same kind of demand profile in terms of work that it might be if they brought in hundreds of other guys they've had to help any other questions in the room oh yes here we go he's back again [Music] discover for me um firstly on uh the pricing in terms of the fee variability what sort of performance metrics are you looking at for that is that just sort of transactional Revenue or happy to cover it yeah um so but we take a look at the transactions that are flowing through the platform itself so let's say uh box office and concessions primarily yeah and maybe just digging a little bit deeper on that the three to five times uh multiple I mean how much of that is am I correct in saying that the three times is really underpinned by capturing share of I guess existing wallet already spent by Cinema and then the upside is perhaps value-ad [Music] I think the um way to think about that one is the share wallet's not sorry the wallet is not going to change so that's it's our share which greatly changes including the transition from the on their on-premise to our hosting and if you think about the three to five anything they do spend you know largely pretty close to 30 of it's going to go into a Costas to serve for us so we're putting a lot of um uh Power behind the uh behind the transition Steve [Music] Stone uh I guess going back to the 300 million Target we we're just trying to think about um I understand how we should think about movio and and the in that kind of ARR Target um you know any sort of I mean how are you going to price move your going forward is that change from you know you used to have sort of Ratchet causes and that kind of thing for movieo Cinema and then you had other models for the other parts of the movie how's that evolving I'll uh I'll just talk to how the transition will work then I'll pass to Sarah we'll talk about what the uh how the market will perhaps utilize movie are going forward differently so if we think about today in in terms of the the pricing for movio or in terms of the the donut on the left in terms of the on-premise world obviously they're not on premise uh movieo is not on premise movies already Cloud um what we think about the maintenance plus movieo converts to a one fee we're more likely going forward to just charge one fee for the entire platform we really want to put in the hands of every customer every bit of our Tech whether they turn it on or we or don't the terrible thing about on-premise software is nobody can tell me what our customers actually use today the beautiful thing about muvio is a is that Sarah can tell me if I asked exactly what our customers use and exactly what every one of our customers use and so we really want the core product of movieo EQ as part of the platform now let I'll hand over to Sarah but there's also a lot more opportunity beyond that in terms of some of the value add that will come about once people just using basic EQ yeah I think um as Matt mentioned by bundling it we really are unlocking opportunities for uh clients who never really thought that they needed a product like movieo or thought it was Out Of Reach because we are sort of a premium tiered product in our industry so we are unable to unlock immediate benefits and some of those I sort of alluded to especially with the integration into cloud and into digital where we can run more sophisticated customer Journeys not just on marketing channels but any touch point the customer has from buying a ticket all through that customer Journey so we're going to have more data to do that with through better integration and also be able to prove that value so to be able to immediately as someone starts using the platform deliver that proof point that they're gleaning more attendance driving more attendance and spend is something I think that movie will really help to power and then yes the extensibility so being able to do more in new channels being able to find more creative uses of your data not just in the marketing space but extending Beyond is something that we're really Keen to partner more and do more through the platform with Sarah so just to clarify so if we sort of split movie onto the automobile Cinema and movie and media and you've already got most of the cinemas using movie cinema already for the databases they're just going to be bundled going forward is that that's it right and then movement media will also be bundled into the offering movie or media is always an optional add-on through different data sharing agreements if you want to put our Cinema Partners in control but we see the studio Suite of offerings be it movieo media matics our research products as definitely an add-on capability that we think will only be Amplified through more Cinemas using the platform so we can dial up that opportunity actually quite a bit more quickly so maybe just one last one from a um you talked about um you know number of growth we've talked a lot about organic growth opportunities and it's been been great and really clear what about an organic growth opportunities this previously been an indication you might be interested in expanding the software suite to face the studios more is that still on the agenda or is that are you focused more on the the transformation of the business I think you know number one focus is the transformation of the business if an opportunity arose which we thought could scale and I think that's probably an important word that I would use to to qualify uh an organic strange way of putting it but yes I know what you mean inorganic M A opportunities then um the other piece is that we would want to be able to establish clearly in our minds that the connection with the platform would give us a one plus one equals three equation um and and it's you know it's fair to say that um and given the strength of the position we're in um uh you know the the number of opportunities that are available to us aren't massive uh I'd also just note that we are talking in platform-wise to the core businesses of the group and we have a portfolio of businesses as you're aware right which are kind of fill in the gaps there a bit and and we've got to keep looking at them and thinking about how they can scale and how they might play or what perhaps not in terms of the platform strategy to help me back in the corner oh no calm down straight um another question for Matt just on the cash burn so I'll just be interested um what assumptions you've made around cineworld and then also be just interested in the treasury policy because I think in the last result you'd scale back the bank facility but obviously the cash burn compared to my forecast has gone up so just wondering if there's you know what kind of buffer is built into the treasury policy uh yes thanks for the um first of all cineworld we've we have taken as we've done throughout the entire pandemic a pretty conservative view on um what the outcome facility world might be in the short term until we get some clarity which could happen in the next week but might too to happen in the next couple of months um we'll continue to both protect the the way we present the p l so and the balance sheet so we've got good Provisions for that um did that answer your silly World question would you always shots yeah so uh the comments uh sorry for those who couldn't hear or might be online was it the some industry figures talk about perhaps reshaping cineworld and perhaps their site Camp going down we obviously haven't seen any of that yet we I would have expected that to happen relatively quickly going into chapter 11. um I think we're pretty well protected from that as we would be from any of the other circuits who have been through financial difficulty and we still have a good healthy uh level of provisions and to be honest I expect to exit this year with a healthy level of Provisions from the um from the balance sheet I I could probably add just specifically around the sites thing that would surprise me uh based on the dialogues we're having currently if it was to the extent it's a suitably political answer for you Phil and sorry the second half for the second question was oh yeah sorry uh yeah so um in the uh in the half year result uh by the time they have a result came out we had changed our banking facility we actually reduced our total Bank facility um we're still positive net cash so when I looked at the facility uh and the shape of the facility if we were to go deep into it in any way would largely through M A we would probably have to explain associate it anyway so it is there really to in the medium term rather than invest for the long term and so I felt very comfortable bringing it down I had factored in the cash burn uh against the current plan um and I just felt very comfortable that we were well within uh the boundaries of utilizing that facility over here I know you spoke to the macro backdrop and obviously it's challenging for a lot of businesses um how are you seeing I guess the sales pipeline in terms of customers now saying hey can we wait a couple of months and see what happens till we you know introduce this full change to their um systems I think a lot of businesses are we're seeing that with pipelines so [Music] uh yeah so good question um I wouldn't say based on just the performance of the last few months really anything has changed in fact these few months in any given box office year I tend to be quite a month so anyway most of these conversations um go on over several months and so those that have had conversations with us mid this year there's no real change in tone we're still seeing continued momentum toward getting on the cloud you know these these conversations are driven on factors that that really boil up for a number of years you know you might pick up hardware and that'll age out over five six or seven years um having a few slower box office months doesn't change the need to really work out what your strategy is as a movie theater as it relates to how you manage to Tech so we haven't seen any real variability there um although all I would say is that what we almost always see is when we see huge films um go on sale everybody does all of a sudden wish that they were running our digital Tech to make sure that their websites and apps don't go down and those sales go down the road to their competitors so I would say if you ask me the same question when Avatar 2 goes on sale I'd say yeah everybody wants the digital platform probably a few weeks ago yeah okay there's another question here [Music] just wondering um what pushback of any you've had from prospective clients is it the price is it the moat for the product or do you know just any pushback of any you've had [Music] I'm actually happy to have a crack at that one I've done much um I think it's fair to say that there is a robust conversation I mean it's a business to business conversation uh one of the things that I've observed is that is the level uh that you're having the conversation with goes further up the food chain then might typically have been where we have had conversations in the past that it becomes a little easier but that's not to say that there's not a Mio Towing and throwing we run a centralized um I apologize for the name deal disc which which kind of like circles around all the deals because um you know it's a different type of selling process for us than it might have been in the past and so we have pretty good visibility of that in in my my observation will be there'll be multiple iterations um generally people's and forwards as we you know continue to prove out the value okay I um see if there are any questions online I'll ask uh Kelvin our general counsel no questions okay so um I would again thank you for your attendance and your attention um please uh feel free those of you in the room obviously to join us upstairs in our mezzanine area where there'll be Refreshments some of our technology and you can uh if you wish in person Grill the team and speak to our directors I'd also just like to acknowledge that Claudia Batten one of our independent directors is in the back of the room so feel free to to grow Claudia thank you very much thank you