Vanguard Health Care Index Fund Price & Performance (VHT)

All right. Thank you so much, Hannah, and hello, everyone. And as Hannah mentioned, we are absolutely happy to be here to walk you through our half year results ending on the 30th September, 2023. First of all, as always, I want to extend a heartfelt thank you to our investors. Your investment in Volpara is not like money just sitting in a bank account, nor is an investment in alternative areas like mining or consumer goods. It's actually an investment in people's lives. It has a real impact on families. And I wish I could share with you the stories that I hear of families that thank us for the role our technology has played in finding cancer earlier when it's curable. I do have women reach out to Many whose families were positively impacted by Volpara's education, our advocacy efforts, as well as what our software does to assess risk and support early breast and other cancer detection. So I'm going to start with that and I will end with that as well. First of all, though, for those who aren't real familiar with who we are, We are a software company and we are well positioned to grow.

In an industry that gets a lot of attention, unfortunately, it's a growing industry. It's growing in importance because cancer rates unfortunately are also increasing. And while based in New Zealand, We're listed on the ASX and our team is global. We have staff in New Zealand, staff in the United States, a growing staff in Australia and even in Europe. So, a little bit more of what we do. Our software supports our healthcare customers' efforts to improve how they screen for cancer risk, how they manage mammography workflows and diagnostics. We don't make hardware, which simply captures an image, but Balpara's software helps physicians provide a tailored and personal approach for each patient starting well before mammography screening age. During the mammogram process, we use artificial intelligence to Provide objective measurement of breast density, which is a risk factor for cancer, and it can also hide cancer from the radiologists who are looking for it. We also help teach technologists how to do the best quality mammogram possible. That in and of itself is an art more than a science. And then we save our customers time providing AI automating administrative tasks, generating required reporting in a very heavily regulated field, particularly in the U.

S. Where 95% of our revenue is generated. So that's a bit about what we do. And we've been doing it very well. We've had a good half to show for it. And after a record fiscal year 'twenty three in terms of new business being 1 in revenue, Volpara has maintained our momentum and posted The highest revenue we'd had for a half year. I'm going to turn it over to Craig Hatfield, our Chief Financial Officer, based with me here in New Zealand, to provide more of our result details for you. And then I'll come back for a few minutes about our areas of focus and our outlook ahead. Over to you, Craig.

Awesome. Thanks, Terry. So this morning, I'm going to summarize our results for the first half of the year ended 30 September 2023. And I'm going to start with the recap of our SaaS and cash metrics that we will have spoken about at the 4C. Just a quick recap. So at the end of our half year, We had contracted and recurring revenue, that's car, top left there, that reached US28.4 million dollars That's up 18% year on year from $24,100,000 a year ago. And that's sort of consistent record growth we've seen in line with what we achieved for the full year FY 'twenty three. Annual recurring revenue, ARR, that's 1 in the middle at the top there, reached US22.5 million dollars That's also up 18% from $19,100,000 the same time last year. And ARPA, the second on the left there, That increased 25% from 32,000 to 40,000 over the last 12 months as we continue to focus on Larger healthcare organizations as our key customers and prospects. Those are probably the key ones on there. We go to the next slide, Hannah. So now I'm going to turn to the more traditional accounting metrics we report in the half year financial report.

Accounting revenue from customers was NZ19.8 million dollars That's up 17.5% on the same time last year or 14% in constant currency. 97% of that revenue is recurring in rate in nature Sure, with the remaining 3% being capital. But more importantly, Volpara's 3 core products, our strategic focus areas of Analytics with scorecard, patient hub and risk pathways delivered constant currency revenue growth of 23% compared to the prior corresponding period. Our overall performance on the top line was somewhat decreased Because of legacy capital and lung revenue declining by approximately 20% on the same time last year as well as legacy MRS support, So that's the sort of precursor to patient hub, also down 4% on last year. The latter is definitely in line with our expectations as we continue to migrate MRS customers over to Patient Hub. And then I'm going to do a little bit more of a deeper dive on the revenue performance for the first half of the year. So although Volpara's revenue consistently increases quarter on quarter, half year on half year, year on year, There is some degree of lumpiness for budget due to the timing of large customer installations. In the first half of FY 'twenty four, we only had one customer go live with a go live with a car of over US100000, albeit this was amongst many other go lives, There was just the one.

But this compares to our H2 pipeline, where we currently have 4 customers Slated to go live with KAR above US250000 dollars and also that's amongst many others. One of those of our analytics customers has already gone live very recently. And then we have 3 others slated to go live between now and the end of March, 2 with Patient Hub and 1 with Risk Pathways. Those 4 will provide significant revenue uplift for the second half of the year. And the key part of this is that people in the U. S. Have started returning after the sort of Peak traditional holiday period that's July, August, September. So we definitely started to see an uptick in go lives. October's revenue, for example, was up 21.5% on a constant currency basis compared to the same time last year. And that was held by the large site that I just mentioned that went live. As a result, we fully expect H2's revenue on a constant currency basis to outperform H1 and bring Bolpara's full year constant currency revenue growth much closer to that 20% target we've been talking about. From a gross margins perspective, that decreased ever so slightly from 91.8% to 91.6 So between 91% 92% appears to be the range that we're working within currently.

And as a result, So gross profit increased 17% from $15,500,000 to $18,100,000 this year. Go to the next slide. We're already. So operating expenses decreased 4% compared to the prior period or in Constant currency, almost 6%. All three major buckets, that's sales and marketing, G and A, product research and development, all decreased when compared to And that's obviously in line with expectations as a result of the strategic review that we undertook in July August of last year. From a normalized non GAAP EBITDA perspective, including the sort of non one off and non cash Items has improved from a loss of $4,200,000 NZ last year to under $1,400,000 This year, that's a 68% improvement year on year. That $1,400,000 loss, just for Perspective compares to a $1,900,000 loss in the second half of FY 'twenty three or a 27% improvement. And all that shows is that we're continuing to make further progress towards EBITDA breakeven. From an accounting loss perspective, continued improvement there as well, 17% from NZ5.3 million to NZ4 point $4,000,000 NZ. As you can see, it's not quite the improvement that we've seen in the other parts of the business, and that's largely been driven by Massive $2,900,000 FX swing from 1 half year to the next half year.

Looking at the balance sheet. As of 30 The company had NZ13,200,000 of cash on hand as well as access to the $2,500,000 Our revolving credit facility. But more importantly, and as we reported in the 4C at the end of October, The business has been operating in a positive free cash flow position for the last 12 months. As far as guidance updates, Bolpara is maintaining our guidance for both revenue, which we have $40,000,000 $42,000,000 for the year and EBITDA guidance of between positive $500,000 and a loss of negative $2,000,000 So So in other words, no change to previous guidance. And with that, I'll hand back to you, Terry.

All right. Thank you very much, Craig. So our business is stable and strong. And as he mentioned, we maintain our previously provided guidance. We will continue focusing on keeping our costs in check even in an inflationary environment and deliver on growth. We're quite proud to have numerous customers expanding their footprint with us, thereby increasing the number of families that we can impact. And with our successful ahead of schedule transition to cash flow positive, And I love shifting to half year reporting. Here are some highlights about our future plans. We've invested in a new Director Business Development for Europe. And this will take advantage of some new opportunities that we are just seeing begin to emerge in Europe. My colleague, Doctor. Melissa Hill and I attended the European Society of Breast Imaging Annual Conference, otherwise known as EUSOBY, in Valencia a few months back. And there we did see a slow but real increase in interest in density, in quality, in the software that Volpara provides. And also together with the recommendations from Eusebi and Europe's slowly growing acceptance of cloud software, which had been a big barrier for us In terms of growth in Europe, our new Europe Business Development Director will prepare for expanding in Europe beginning in the calendar year 2024.

While speaking of expansion outside of the U. S, another project that we've begun is regionalizing our risk pathway for Australia and New Zealand markets. This is important to us because we want our staff and the women in the part of the world where we're headquartered, as well as our 2nd biggest market of Australia to be able to benefit fully from what Volpara provides, assessing lifetime risk Again, even getting people an understanding of their genetic risk. We're also continuing our work with the original equipment manufacturers, we call that OEMs, who make the mammography equipment to further develop our live software. This is software that actually provides feedback on positioning and quality right in the room at the time of the mammogram. And this is something that we've done with Fuji, and we're extending what we're doing to other manufacturers as well and seeing if that's a product that we can grow more globally. Also, Building on our early advocacy for risk assessment before age 25, we're putting some marketing investment into encouraging to use VULPAR risk pathways outside of the mammography setting, in areas like primary care, And expanding into a couple areas we'll talk about more in a minute.

Our R and D engine is tuned, And we have an early version of our first new product in a while, Quiver, which will be shown later this month at RSNA. It is on target. I can't pass up a good pun, Quiver, on target. I can't hear you guys all groan, but I figure somebody's groaning somewhere. It's on target for release next year. And what Quiver does is it leverages our analytics platform to provide Single digital location where customers can track quality control, staff educational requirements and other administrative functions. And Quiver will centralize, digitize and automate these compliance tests, which will reduce the administrative burden on the mammography staff and allow them to spend more of their time with patients. This is our biggest focus in terms of new releases, but we're also busy prioritizing our plans for the next key innovations as well. And speaking of innovations, our density software stands unrivaled. It offers the most Rigorously validated and precise volumetric measurement in the industry. It outshines everyone else in the field, And it provides breast density information that will support the FDA's directive to inform women of their density. This has sparked more conversations about the importance of a consistent and objective measurement of density.

The FDA ruling publicly affirms how important this breast density information is to providers and women, and it's a model that we hope other nations will follow. I'll remind you, Volpara's volumetric density is the sole automated measure validated for use in the widely accepted Tyra Cusick Version 8 Risk Evaluation Model. So this interest is not solely about density, however. A matter of escalating significance in the United States and beyond is understanding the risk of breast and other cancers. A risk assessment program will be required for the National Accreditation Program for Breast Centers, otherwise known as and a PBC for these sites to maintain their accreditation or for new accreditation. And starting already in January of the next calendar year, Volpara firmly believes that women should understand their own personal risk of breast and other cancers at an earlier age, and we join with numerous medical bodies recommending starting that assessment at age 25. So In addressing sales drivers and marketing, of which those are key drivers, while this is meant to be our forward outlook, I actually want to step back a month to October, which was Breast Cancer Awareness Month. This is the time in the year when our industry gets massive global attention.

And our SWIFTI campaign was meant to encourage doctors and patients to have the conversations early and to become informed of all of the It's associated with cancer risk as it goes way beyond simple family history. And we want the younger people, those that are the ones that might go to the Taylor Swift contest and really resonate with this marketing approach to become informed and have those conversations. And while these campaigns may drive increased software revenue, the biggest motivation really is the opportunity to save lives in the approximately 10% of women who are diagnosed with breast cancer before mammography age. Research in the last two years indicates that breast cancer is actually the most common type of cancer among young adults, aged 15 to 39, and it accounts for 30% of all cancers in this age group. They cannot be ignored. Closer to home for those of mammography age, we also encourage those in our community in Wellington to make sure they get appropriate screening. We put Fun messaging on public transportation in a lighthearted message from our corporate mascot called Kiko, the blue footed booby to get your breast checked. A QR code on the bus would help people locate a New Zealand provider using Vopara's breast density assessment software.

The attention from everyone in the industry associated with breast cancer awareness in October together with the NAPBC accreditation requirement Our risk programs is keeping our sales team busy. The NAPBC sites are a great way to get to know their parent elephant sites, So watch for further landing and expanding as we continue with our renewals and growth of current customer contracts. Next slide. So the biggie for us all year for sales and marketing at least is this month, November, heralding our top lead generating trade show called RSNA, which stands for the Radiological Society of North America's Annual Meeting and Scientific Assembly, a mouthful. This is the largest medical imaging forum in the world, with tens of thousands of attendees from over 100 countries. Our senior team will be boarding planes from New Zealand starting tomorrow to join our counterparts in the U. S. And support our sales team, our product team, our marketing team in setting the foundation for the next calendar year. Volparo will have a strong presence with a beautiful and welcoming booth, where we will quite proudly show our market leading products as well as, I mentioned, our new product, quiver to customers and prospective customers.

Volparo will also get great exposure through 2 research papers, including validating all of our work in high risk program development and mammography quality improvements. And finally, we have A team of MBA students from UCLA joining us to conduct some market research and some focus groups addressing new ways to expand and sell our risk pathways product. This data from this team will feed into our planning for the next year as well. Next slide. That leads us into December next month, the time of year when customers and prospects, our sales folks and our legal team are very much focused on working through contracts and trying to sort out projects before the holidays hit and the United States customers' budget years end. Quite common in the U. S. For people to follow a calendar year and fiscal year ending December 31. So it's a time of lots of planning for the following year, Lots of closing out lingering implementation projects, as Craig mentioned, and we'll have several big go lives in these couple of months. This is the busiest time of year for Volpara. We have welcomed several large elephants last year, and now they're going live. So our schedules are full, including some very large Elephant prospective customers, discussions with potential partners, scientific and research collaborations, and our team is geared up and ready to go with a focus on our key markets, our key products, and sharing the solid ROI and successes with our customers.

And since December, it's heavily about our customers. And speaking of those customers, Our Hyve customer community, which was initiated just last year, has been absolutely Buzzing, I know, another pun, I couldn't help it. So sharing the solid ROI and sharing the successes of our customers, they've been very busy, hosting 36 different events, providing training, holding quality forums. And this is actually really important to work More broadly than just within our customer success team, because our large and influential customers are key to engaging with other Large and influential customers, which is key to growing our revenue and growing our positive impact on more and more families. Names and pictures shown with their permission, by the way. We're quite proud of the engagement our customers do with our teams. So speaking of large accounts and our customers, a presentation from me would not be complete without at least one picture of an elephant. And we've grown our number of elephants. And we also count calves, which is any customer that brings us over $100,000 recurring revenue. And new elephants and calves to join us in the past year are listed below. This list includes organizations like Tenet Healthcare, which is a nationwide U.

S. Healthcare system with headquarters in Dallas, Texas. Things are big in Texas, and that includes Tenet as they have 61 acute care hospital facilities. They've been a customer for a long time. However, what we love is they've been adding to more and more of their facilities over time, bringing them into the club of calves and elephants with several new hospitals added, and also a new centralized technical environment for Volpara to facilitate further growth of additional sites. We're also quite proud, as shared previously, BreastScreen Victoria signed a 5 year contract for Volpara's Analytics to optimize mammography operations in more than 50 locations in this state and Australia. And this furthers Volpara's presence in Australia, adding to the existing contracts with BreastScreen Queensland, BreastScreen South Australia, EyeMed, Sonic, IDX, Lumis, Wellesley Breast Clinic, Sydney Breast Clinic and more. I'm going to wrap up talking about our elephants and our calves by mentioning Memorial Sloan Kettering Cancer Center. MSKCC is consistently ranked in the top two hospitals for cancer in the United States and even globally. You look at U. S. News and World Reports, Newsweek, Verywell Health, the various different companies that really dig in on who is Most respected and does the best cancer care, MSKCC is always at or near the top.

And we are so honored to be chosen by such Prestigious and large groups who really do their homework, who really know what they're doing. So MSKCC, Hackensack, Texas Health Resources, we are very, very proud of our customers either joining the fold or adding their to their footprint with Volpara and doing more and more with our software and taking care of more and more patients and their families. So we're quite proud of the work our customers do and we're glad to help them do it just a bit better with our technology. So shifting a bit more about technology, $100,000,000 Our software is absolutely market leading, and it's important that we maintain and grow that edge. And with that in mind, we're excited to announce we've crossed over 100,000,000 images. We began sending de identified Images and study data to the cloud back in 2016. And we do believe we have the largest data set of mammograms available for R and D in the entire world. This is important as it enables our continued market leadership with current products. We continue to improve our current But it also supports development of new algorithms, such as our breast arterial calcification algorithm that we created together with Microsoft.

So speaking of Microsoft, given that this is a half year report, while I announced this earlier in the year, it bears reminding for those that hadn't heard, While Para won Microsoft's Global Healthcare and Life Sciences Partner of the Year Award, chosen from over 4,000 nominations from more than 100 countries. And this award recognizes a partner organization that excels at providing innovative healthcare and life sciences solutions based on Microsoft Cloud Technologies, driving customer growth, transformation and enhancing patient care. Harrow was also named Microsoft's New Zealand Partner of the Year for its entrepreneurial spirit, social impact and growth. And these awards give us additional visibility and connections with Microsoft innovators, allowing us to open the doors for future projects. And when we combine a strong relationship with 1 of the most innovative companies in the world, together with the largest mammogram image data set in the world, And then also include data from our patient hub products, we have raw materials for new market defining innovation. So bridging images, radiologist insights, procedure results, that's a magic combination that most vendors don't have today. And I think this will become a mission critical element as we start looking at AI technology in our industry, similar to what we saw for autopilot technology in commercial airlines.

So lots going on, a lot more going on, Dozens of research engagements, working with Cancer X, I could talk with you all day. And these things do matter. But I promised in the beginning, I would come back to what we really think matters most. And that is a quick note. When people say things like, hey, Thanks for saving my life. Wow, that matters. I'm really proud of our team. They're engaged with Absolutely, unwavering dedication to building the very best software, leveraging technology to help our customers with empowering women, providing tailored care for all of our patients and their families and conducting precise risk assessments. I'm proud that our technology, deployed broadly in consistency, really does save lives. That's why I show up for work every day. And with that, I'll conclude and open up for questions.

Thank you very much, Terry. We do have questions that have coming so far. Okay. So first one, Terry. You mentioned earlier in the presentation that 95% of revenue is sourced from the U. S. Can you talk to the opportunities elsewhere that Volpara are targeting in the near term?

Absolutely. We will expect that the majority of our revenue continues to come from the U. S. For the foreseeable future as the U. S. Spends a lot on healthcare and on mammography, and they're very accepting of the cloud, and our technology fits very well with And you'll see us regulations. However, we've continued to grow what we've been doing in Australia. And as I mentioned earlier, while I'm not looking for a big jump in revenue from Europe In this coming year, potentially the year after that, as Europe has been a challenging area for us to grow, we do have some Customers in Europe and we have a small number of staff in Europe, but in Europe, acceptance of cloud technology has been far slower than the United states and other parts of the world. We do see that changing. For example, Spain had essentially no Technology leveraging cloud 2 years ago and now they're nearly 100% cloud. On a country by country basis, our software deployment approach of SaaS and cloud is much more interesting and welcome. And so we Expect that we'll be doing some business development work in the following calendar year, and we'll reap some of the benefits of that in the year after.

There are some other parts of the world that we're interested in, but we introduced the concept of deal thresholds for new markets. And we don't want to enter a new market unless we see clear visibility to at least R100000 in revenue. So we are continuing to be cautious in how we spend money developing new markets until we know that there's a good software fit, Big enough purchases and the ROI will be there. Anything you want to add on that, Craig?

No. Thank you, got it, Terry.

All right. Thanks very much. The other there are 2 other questions. They are quite similar in nature. I'll read them out just to see if you have anything to add to that, but you may have covered it off already. So the first one is you've previously been very cautious about prospects in Europe. Given the key staff appointments announced today, What made you change your view? And then the second one is, can you please elaborate on the European market development starting calendar year 'twenty four? European Medical Tech Market compared to the U. S. Was commented to be more difficult to tackle. 1 or more country to country basis, as you said, were more bureaucratic procurement processes. How much is the company planning to invest in the 1st calendar year, for example?

Yes. So we definitely have changed our stance on Europe. And part of it is based on I spent about a month in Europe and met with both key partners and key prospective customers. We have been doing research in Europe for quite a long time, over 10 years. And so we do have connections with some of the bigger screening programs, which are very, very difficult to get they're still heavily studying what to do versus doing significant investments. However, they're moving in the direction of more investment and more signaling of a likelihood to buy systems. And When you're in national screening programs, if you don't have a presence there early on, it's very, very difficult to build it later. So we are doing some foundational work to ensure that we're familiar with the people and the technology associated with potential large screening program investments. But the biggest difference really is the acceptance of cloud. When we spoke with people in Europe 2 years ago, it was we won everything on And we want a capital purchase, and there's a lot more willingness to consider cloud software. We are being cautious. So we've got our Business Development Director, his 1st 3 months full time will be actually building a business plan, Reaching out to both partners that we've worked with in the past, as well as what are the most likely candidates We're going to do it in a very selective way.

And again, using that new market deal threshold approach to ensure that we don't We'll remain somewhat cautious, but I do expect in calendar 2025 that we'll see the fruits of some of those efforts come through.

All right. Thanks very much, Sari. A few more here. So I think that the person who's asked us actually made an error in this question. So I'm going to correct it for them. And it says, what other areas other than breast could Volpara's products be applied to? And why the exit of the loan of They said Heartscan AI company, but we think that they mean lung.

Yes. So right now, our risk pathway software can identify people at Risk of multiple cancers, not just breast cancer. So it includes, colorectal, ovarian, Endometrial pancreatic, we are at lung and with our breast arterial calcifications work, we do have Plans to go into the cardiology area. Just to explain for those who aren't familiar, breast arterial calcifications have Our researchers have found are linked to heart disease. Heart disease kills 10 times the number of women that breast Cancer kills. Now breast cancer is still heavily diagnosed, but the good thing is early diagnosis means it's curable. And heart disease tends to be considered the silent killer of women, because a lot of women aren't aware that they have Heart disease and they don't have the traditional symptoms that a lot of the men experience of a heart attack. So they'll often have indigestion or fatigue instead of Crushing chest pain and pain radiating down the left arm. So if when somebody goes to get a mammogram, We can also find out that they might be at risk of heart disease and send them to a cardiologist. I actually believe that's our obligation. So pulling together the detailed insights in our AI on the images together with risk of heart disease And a more comprehensive offering that's personalized for individual patients is an area that we expect to grow.

Now this is FDA regulated. The 1st vendor to do anything in that area just got FDA approval. Our algorithm is in the hands of researchers right now, and that is a process that takes multiple years. So it's not something that you'll see This year, probably not even next year, but the year after, we'll see how it goes. But I look at our Goal as a company is saving families. And we had been very, very focused on cancer, but gosh, If we can actually save lives in the heart disease side as a byproduct of the work that we've done in breast cancer detection and density, then we should do it. So very, very interesting possibilities for us in the future, but don't expect that you're going to see massive expansions into those areas in the next 12 months or the next half.

All right. Thanks very much. So next question, how should we think about the scalability of the business and the cost base moving forward? You know what, I feel good about it, but I'm going to turn it over to Craig to just give me a break for a minute.

Cool. So thanks for the question, Emily. We're about a year or 18 months ahead Schedule when it comes to cash flow positivity. We were thinking we'd be in this position sort of this time next year. So we're in a bit of an interesting position because I think we're sort of ahead of schedule and being able to take advantage of our Strong position. And what I mean by that is, we've got a, in our view, a strong stable business With definitely a scalable cost base. So we're looking at a couple of areas of expanding headcount, but nothing material. But the areas we are focusing on are sales and at the end of the day revenue. And what I mean by that is sales In the traditional sense, just adding a couple of headcount in the sales area, we know that takes a little bit of time to bear fruit. So yes, We hire a couple of additional salespeople now. By the time we close deals and get revenue, we're probably looking at this time next year for anything material. So we're looking at that as we speak. The other area is in revenue. And what I mean by that is Yes.

And we've been pretty clear about it. We've got a gap between CAR and ARR. And what we're really trying to do is try and close that gap. We haven't been as successful as we would have liked to have been, to be quite honest. We're sort of the gap is sort of maintaining the gap as opposed to reducing And that's really about getting our customers live faster. So we've got excellent teams in onboarding and training. But if we add 1 or 2 in that area, can we get those customers live faster? We think so. So we're definitely looking at a couple of headcount in that area, just to try and get our customers live as quickly as possible And just to also give us that team a bit more breathing room. So those are probably the only two areas we're really sort of focusing on in terms of Headcount addition, besides that, we feel like for to a large degree, the business is pretty scalable from this Position, Terry?

I'm going to add to that. We're actually looking at killing 2 birds with 1 stone, although Like violent metaphors, but one model that worked really well for me at EPYC was bringing in people that have a good base of the world of our customer clinical knowledge or clinical experience that can both help with deployment, but also be very supportive of sales or even move into sales. So, we are looking at expanding our customer success team, as well as bringing some clinical roles into the sales process to be able to then both enhance our ability to bring some of those Big elephants over the line and do very consultative sales processes, but then also engage with that helping our customers shorten the time from when they buy the software until they're fully deployed and we can recognize that revenue. So That's the most likely area for our company to grow. We've got several open positions right now.

All right. Thanks very much, Sherry. We've got one final one here. Again, back to Europe. So it says for Europe and I guess other regions too, are your products already translated And or are they easy to translate for future use in additional markets?

Okay. Yes. Our software is not already translated into a number of different languages. That's a process that we would go through if and when it was necessary. There are some we're definitely giving a preference to European countries that don't require that translation. So for example, in the UK, they mostly speak the same language as New Zealand and America, Few differences, those are pretty easy to accommodate. And we do have relationships with third parties and have been able to do translation with scorecard, for example, in some other countries right now. So we have the experience to be able to do translation as necessary. But we're cautious that we don't want to go in, spend a lot of money On a market, do a lot of translation for demonstration purposes without seeing that there are going to be significant prospect of customers turning into real customers. So, the other thing that's nice is certain European countries don't require translation of everything. Patient facing materials, absolutely. So we do have translations right now for common languages like Spanish, which The United States has a very strong Spanish speaking population, and we've been able to accommodate that through flexibility we've built into the software.

So it is something that we can do, whether we do it directly or we have relationships with a couple of different partners in Europe who have some Really good experience in helping manage that process. That's part of what our new Director This development in Europe will be taking on and one of the factors that he needs to bring into the business plan is we need to ensure that if we're doing an investment in Translation is going to give us a solid return.

All right. Thanks very much. So we've got one more that's just come in. And it says, what, If any, are the biggest challenges you are currently seeing with regards to growth?

It's always challenging for a company to be making sure that we're managing our costs and continuing to go forward in a cash Slow positive way. And there are always parts of the company that you wish you could invest more. And so it's a balance in prioritizing where we invest our time and effort and energy. We can't do it all. And so the skill of figuring out what do you say no to and what do you say yes 2 in the nose are almost harder than the yeses. I think that's definitely a challenge when you look at our operations and our product. The other challenge, of course, is driving sales and making sure that we've got the right size sales team to best engage in a slightly different way with Elephant customers where we really do a higher touch but high return sales process. Those sales are lumpy in terms of we can get a big dollar amount coming in, which Then provides lumpiness to our revenue as well. And the you might get them over the line In the last week of the quarter or the 1st week of the next quarter and those are important legitimate growth, but they're challenging In that, you want to get them signed and get them committed, get through that process, not do price concessions, In order to meet the deadlines and there's a lot of focus, a lot of attention.

Sometimes you're tempted to let somebody go forward with A small initial site versus hold the course for the bigger organization and you're taking the approach of be disciplined and hold the course for the bigger organization with the exception of the NAPBC sites that absolutely have to get something in place right now. So I'd say we've got 2 different growth challenges that we're attacking a little bit differently, but we feel up to the task.

All right. Thanks. Again, we have one more. And this is actually a really interesting question. Is your focus on cash flow positivity potentially inhibiting market capture and expansion, particularly in new geographic locations?

Maybe we'll answer that next year after we have our business plan for Europe. In some ways, of course, it inhibits that you're not we're not going to just try to sell everything everywhere to everyone right now. We are focused and we are careful about it. So will inhibit some. However, I think the discipline is good for us. I guess in my experience in this industry, and I've I've done it for a long time. I first ran international sales for another company back in 'ninety nine. You often find yourself in this situation where people say, Just do this one pilot and it's going to open up this whole market. That's almost never true. And Using the nope, we're going to be careful that we see the visibility to the revenue before we really invest in a market. I think actually in the end will keep us from wasting a lot of money in going into markets that aren't ready. So Yes, we'll lose some opportunities, but I think we're a healthier company for it.

All right. Thanks very much. Thanks, Greg.

I think you hit the nail on the head. And I think when we look at a lot of our competitors in The different parts of our business, I think that's a challenge that they have struggled with. And I think we probably struggled with that in earlier days. I think in the last 18 months, we've really focused on the areas that we know will bring in the revenue and have been disciplined And in those areas, and I think that's why we're in the position we're in now. Now it's about focusing again, but in a different way because we're now cash flow positive, we can take Advantage of the position, Marin.

The I'm going to add one other thing to that too, which is Historically, like a brand new company will and many of the other vendors in our space will give the software away for free in order to enter into a new market. And We're away for free in order to enter into a new market. And our software is validated enough that we don't need to do free. And so that allows us though to go into a new market with a position of strength, where we're not tempted to do Lots and lots of free deployments that actually cost us time, effort, energy and focus and oftentimes return absolutely nothing. So we are approaching it with, we don't have to do free pilots. We've got 400 research articles using citing using our software. We are we know it works. And if you want to have the best software, it's reasonable to ask people to pay for it, and they do. Where it's reasonable to ask people to pay for it, and they do.

All right. Thank you very much, Baidh. That's it for the Q and A portion of the webcast today. If you do think of a question and you didn't get time to ask it, that's okay. Our contact details are actually on your screen at the moment. Please do e mail it to us, and we will come back to you as soon as possible. Before we close today, Teri, do you have any last remarks?

Yes. Again, I'll thank you for investing in us. I have the best job in the world. I've got a great team. We've had a Great half year and look forward to an even better next half. Thank you.

Perfect. Thank you very much for joining, and thank you very much, Terry and Craig. Goodbye.