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And following changes, imposed by the Biden administration, we've taken the decision to focus on more attractive areas in China. We are starting to see positive signs in all three sectors. And we expect a stronger second half of twenty twenty five after a weak first half but the precise timing of the recovery remains difficult to call. Gives a wide range of outcomes for 2025. We've therefore taken steps to ensure our balance remains resilient in all scenarios. We completed a £40,000,000 placing this morning and we've also agreed revised banking covenants Our focus remains on our execution. Being ready to support our customers through the anticipated market recovery. I just wanted to spend a couple of minutes talking about our strategy. How our consistent application of it positions XP for a strong future continue to deliver on all elements of our strategy, as we have navigated the challenges of recent years and we've made further progress in 2024. Just focusing on the key points. Our focus is on organic growth. We have a market leading product portfolio, which we have further enhanced in the year through new product launches, and customer specific project [indiscernible] Interest levels remain strong for our portfolio, we remain confident we can continue to deliver double digit organic growth across the cycle. [indiscernible] Building on these strong relationships will give growth over the medium term.

We've continued to invest in our business ensure we can deliver on our medium term potential During 2024, we opened our customer innovation center in Silicon Valley, [indiscernible] Close to many of our customers, and we believe a key differentiator for us that will further support growth. Our people are key to our strategy, improving the skills of existing teams, while adding key talent in the right area is critical Whilst we have reduced overheads in 2023 and 2024, we've ensured we protected the key capabilities that were critical for our success. We continue to make progress in sustainability, which I'll cover later. And the point I would leave you with is that we have consistently applied this strategy and this has enabled us to deliver growth ahead of the market and we believe we remain in a strong position to deliver our ambitions in the medium to longer term. Okay. Just as a reminder, we continue to focus on structural growth markets where we have leading positions. As you know, each of the semi healthcare and industrial tech markets have faced challenges in recent times. We the fundamental drivers underpinning their long term growth trajectories remain firmly in place.

Semiconductor industry is definitely turning. The end market has returned to growth. And this will translate into WFE growth in the near term. The destocking in healthcare and industrial tech sectors is easing and it will return customer by customer [indiscernible] Some are already back to normal order patterns, while others will take more time. When the markets recovered, we believe we are well positioned to benefit from the tailwinds with recent customer wins and new products coming to market adding to this. And then And then finally, just to provide pan over to Matt, I just wanted to we believe the market recovery combined with the delivery of our strategy will yield strong financial returns. Our model outlined on this page remains valid and intact. As a reminder, over the medium to longer term, we are targeting to deliver 10% revenue growth across the cycle driven by [indiscernible] new customer wins and new products coming to market. Are confident [indiscernible] we're confident margins will improve driven by the market recovery the operational associated operational leverage. And with this, combined with our ongoing cost and productivity focus and the transfer for further production to our low cost sites in Asia will further support margin improvement.

This combined with continued strong cash conversion will enable us to reduce debt levels to the one to two times EBITDA the short term and below one terms in the one times in the medium term. Which we believe is the right level for us will hand over to Matt to cover the financial performance. Thanks. Okay. Thanks, Kevin. Good morning, everyone. So let's just review the numbers starting with the headlines. Okay. So order intake totaled £181,600,000 and was 10% lower than the prior year. The decline reflects unprecedented industry wide customer destocking, within the industrial technology and healthcare sectors, Full year revenue of £247,300,000 was 20% lower than the prior year, again largely reflecting destocking within Industrial Technology and Healthcare, Sales into the semi sector generally performed better despite some geopolitical headwinds in Asia that I'll come back to later. Lower revenue normally means lower margins as fixed costs within the business are less well utilized, the relatively modest margin reductions you can see here [indiscernible] speak to the concerted effort we have made throughout the year to right size our cost base to the conditions and I'll speak more about that in a minute. The slowdown in revenue inevitably led to a year on year reduction in operating [indiscernible] Albeit the size of it was significantly narrowed by the program of cost reductions I've just referred to.

We will retain tight cost discipline as our top line recovers to accelerate our return to target margins. Whilst unusually tough market conditions precluded a strong profit performance, we were very pleased with our cash performance. Cash conversion reached a record 61%, thanks to tight control of working capital which helped to reduce borrowings to £93,500,000 Overall, market conditions in 2024 were undoubtedly tough for the entire industry we were pleased with the way we took proactive action throughout the year to maximize our performance in challenging conditions. Okay. So let's just turn to the income statement. As I mentioned, revenue reduced by 20% in constant currency. And by a further 2% due to currency movements. Further down the P and L, you can see how we responded to this. Gross margin reduced by 50 basis points to 41%. Far less than would be expected given that our factory fixed cost base was less well utilized. The impact of factory underutilization was largely offset by underlying cost efficiencies, which I'll speak more about in a minute. Indeed, these cost efficiencies help to drive an improvement in gross margin from the first half to the second. Operating expenses were right sized to the conditions We responded to a 20% reduction in revenue [indiscernible] an 18% reduction in overheads, with most of the actions taken early in the year.

Net finance expense was held broadly flat, which with bank interest savings from reduced borrowing levels offset by IFRS 16 lease interest, from our new Silicon Valley facility. The tax rate was reduced from nearly 37% in 2023 down to just under 25% in 2024, as a consequence of better tax planning. As we committed to do. All of this resulted in adjusted EPS of 42.9p. Okay. So just turning to orders. We saw intake reduced by 10% to £181,600,000 were pleased to see orders from the semis market return to growth. They were up 37% year over year and by 22% sequentially from the first half to the second. A change in U. S. Export rules at the end of twenty twenty four prevents us from serving China's semis market going forward. Impacting just under 10% of sector revenue. But there is no doubt that the global semiconductor manufacturing equipment sector is now in an up cycle. Orders from the industrial technology and healthcare sectors declined year over year due to channel destocking, which took hold during the first quarter. Thereafter, ordering patterns were fairly stable but showed some early signs of improvement late in the year. However, at this stage, it is clear that destocking is going to carry on into the first half of twenty twenty five, before dissipating thereafter.

Let me add some color to the revenue performance. Group revenue slowed slightly from the first half to the second. As it took some time for destocking to work its way [indiscernible] from reduced orders into reduced revenue. We exited the year with steady revenue of £60,000,000 per quarter. Sales into the semi market returned to growth in H2, as the industry moved into upcycle. Which we were pleased to see and we were also delighted with the performance of our high voltage, high power business, acquired in 2018. Okay. So this slide underlines the impact of our self help initiatives in the year. As the chart in the top left shows, reductions roughly halved the impact of revenue reduction on profit. Savings of this magnitude inevitably mean role reductions, and I have summarized in the bottom left how head count has evolved since our funding plan launched in late twenty twenty three. We are operating the business today with 23% of your roles, in response to a 20% reduction in volume. The business today is leaner and more agile, and I'm confident that having retained roles so as product development and customer facing positions that are critical to our long term success, we are well positioned to maximize the upside of market recovery.

We will continue to keep our cost base under close review. Okay. So cash was undoubtedly the highlight of the year. Converted GBP25.1 million of operating profit into £65,600,000 of operating cash, which reducing working capital, particularly inventory. This has been achieved whilst also speeding up deliveries to customers and we have not allowed any compromises with customer service. Physical CapEx reduced by two thirds year on year to just over $1,010,000,000 pounds with the majority of that being spent on completion of our Silicon Valley Customer Innovation Center. Regards Malaysia, we plan to complete construct by which point we would have stretched an original eighteen month project into a three year build. Clearly, cash preservation remains a priority until our market recover but the project is very important for our future, and we must also fulfill our contract Okay. Before we talk about the actions we are taking today to strengthen our capital structure, I thought it'd be helpful to summarize what has already been done. We launched our funding plan in early November twenty twenty three at the start of the market slowdown. An important element of that plan was actions we could take ourselves to reduce cost and maximize cash.

The slide shows that we have gone much further than was originally planned. As you can see, we have delivered more than double the cost reduction We have also worked hard to improve our supply chain efficiency. As I mentioned earlier, lower revenue means lower factory utilization, As shown in the top right, all other things being equal, this should have reduced our gross margin by two ninety basis [indiscernible] illustrates the underlying efficiency gains we have made totaling two forty basis points through numerous initiatives reducing factory fixed costs, better sourcing deals, better purchasing, better logistics, a better manufacturing efficiency to name but a few. This puts us in a good position to expand our margin as demand recovers. As can be seen in the bottom right, all of this has helped to keep our leverage leverage below 2.5x as we committed to do. And this has been achieved despite market conditions being more challenging than we originally Okay. Before I get into the detail of this slide, let me start by saying the Board is fully committed to achieving the long term leverage targets of zero to one times EBITDA, which is foundational for long term value creation.

We are confident that we have the right strategy and the right business model to rapidly delever our balance sheet in normal market conditions. And that normal market conditions will inevitably resume. Our challenge is that it's hard to be precise, but about when normality will resume, in particular, destocking will end. In the meantime, despite our best efforts, we are operating with higher than normal leverage, [indiscernible] And we have had some unforeseen events recently as shown in the graph. Judgment in respect to the Comet legal case, which was more costly than we expected, new export rules that deny us access to semi's customers in China, These events combined with a small step down in EBITDA from the first half to the second in twenty twenty four had the potential to increase our leverage to covenant limits which is why we acted last month to amend these limits with our banks. Extra covenant headroom is, of course, helpful, but the Board concluded that a £40,000,000 share placing offered better balance sheet resilience and would support the scheduled refinancing of our bank facilities later this year. Decision was not taken lightly, but we believe it is in the long term interest of shareholders allowing the group to navigate the coming months with confidence and make the very most of the recovery.

As the market recovers, any excess proceeds raised from this placing will of course be returned to shareholders. Okay, some quick comments on 2025 modeling, which Gavin will expand upon when covering the outlook. We expect H1 to be weak, due to destocking and headwinds from the China semis market. Q1 revenue will be unusually slow due to the timing of deliveries, but our order book suggests revenue will pick up in Q2. We expect conditions to improve in H2, but it is difficult to be precise about the timing until we are further into this year. Which makes for a wide range of full year outcomes. We expect overhead growth of 5% due to a combination of inflation and other factors as stated on the slide. We will not be adding heads until conditions improve. Regards cash, conversion is expected to remain above 100% and total CapEx will be between £20,000,000 and £25,000,000 including Malaysia. So with the numbers done, I will hand you back to Gavin.

Thanks, Matt. I'd like to now cover our end markets and what we are seeing in each of them. Starting with industrial technology. As you know, the Industrial Technology sector is a very diverse sector for us It's a broad cross section of accounts with no large individual programs, even though we work with many many large blue chip industrial customers. Latest forecasts suggest the market will grow at Circus 7.5% over the medium term, If you look at the graph, you can see the impact of the stock build in 2023 and the destocking in 2024 this is complete, we expect the market to return to more normal growth patterns going forward. A key driver of this growth is innovation by our customers. Customers' applications are becoming increasingly more complicated and connected. And our focus has been in making our products digital to support our customers' requirement. Within Industrial Tech, we focus on subsectors with good long term growth potential and attractive niches. Typical applications in Industrial Tech are in areas such as robotics, analytical instruments, test and measurement and additive printing. As I've said, 2024 was an atypical year for the market, [indiscernible] seen destocking This is coming to an end customer by customer We expect this sector to recover in 2025, but at different speeds, [indiscernible] and Europe leading Asia.

Looking at the semiconductor market, manufacturing equipment sector, despite what we are doing in China, The sector remains an exciting and important area for the group. Semiconductors are the foundation of the digital economy, making them more strategically and economically important than ever before. Forecast suggest AI and data will drive the end market to above $1,000,000,000,000 by '20 And now while the market has been going through a well documented down cycle, the end semiconductor market has returned to growth 2024 and we are starting to see recovery. This end market growth, combined with the government supported spending, is fueling investment. And the global industry is adding more fabs with 18 new construction projects starting in 2025 on top of the many more already in construction. And there is strong suggestions that the fabs under construction are expected to install in equipment in the current year. So we're through the trough and now expect the market to recover we have increasing confidence in 2020, 2025. This market remains a great opportunity for XP. And we're seeing new product wins across the industry and across the differing processes we've met with new and existing clients. We remain confident we can take share grow ahead of the end market and over the medium term as the market recovers.

And then finally, the Healthcare sector. Which is a long term growth opportunity for XP. The end market remains strong and our customers are seeing good levels of demand. So the underlying demand is being masked by destocking is stronger than our reported results suggest. The medical end market medical device end market is also showing strong growth. [indiscernible] out to 02/1930 using the external data we have. What's driving this? Gross driven by the megatrends of aging aging global population, and innovation in medical technology. Are seeing ongoing infrastructure upgrades and innovation for new products in many areas such as robotic surgery, automated monitoring, advanced diagnostics, the innovative use of technology for patient treatment We're also starting to see the AI impact on medical impact, medical imaging and patient treatment device. Supporting these trends not only requires innovative reliable power also but also customers need a power technology partner. So an attractive area for XP with both new and existing customers. In summary, we expect demand to recover as inventory is used up and growth to return during twenty twenty five. Just wanted to take a few slides just to highlight some of the progress we're making on delivering on our I've said, having a market leading product portfolio is key and the high level of customer wins illustrates We've been stepping up our innovation over recent years, And in this page, you can see some of the products we have bought to market in 2024.

They combined with our existing portfolio enable us to work with customers to address the power opportunities they have in their portfolio and support their innovation agenda. Which is key to our growth. Another key part of our strategy is target accounts where XP can add value. And I wanted to highlight this [indiscernible] surgical robotics market $20,000,000,000 by 02/1930. This growth is fueled by increasing demand by minimally invasive surgeries and advancements in robotic technology, Surgical Robotics, robots are revolutionizing healthcare enhancing precision, reducing recovery times and boosting patient safety Their advanced functions require reliable, high performance power solutions for uninterrupted operation and critical procedures. We work with customers in all three regions in robotic surgery.

Recently, a surgical robotics systems manufacturer approached us to address their power related challenges in their next generation surgical robot and essential control unit, This demanded high performance medically compliant power solutions and the customer was facing several pain points with their existing setup. Which we had to work through with them.

We proposed a customized power architecture Our technical team collaborated closely with the customer's R and D team. Working extensively to analyze the system, troubleshoot challenges and refine the solution. The case study underscores XP Power's leadership in addressing complex challenges within high growth markets like surgical robotics. Leveraging our diverse product portfolio, including low voltage, high voltage and programmable solutions, and configurable power supplies, which are equipped to meet evolving demands of not only in healthcare, also in the semiconductor and industrial markets. The next part of strategy update I wanted to talk discuss how we develop our relationships with our customers. This page shows how we've become a trusted power solutions partner one of world's largest manufacturers of analytical instruments and lab equipment. Been able to gain share deliver on our goal of achieving organic growth. Above the 10% through the market cycle with this customer. As you can see, we supply a diverse range of power solutions from our entire portfolio to support their wide range of products. Examples include programmable power supplies to power mass spec, desktop and open frame medical power supplies to drive centrifuges, configurable power supplies to provide flexible solutions for liquid chromatography, high volatages DCDC modules in mass spec, And finally, on the right hand side, we're taking a product from FUG, our recent acquisition, This is used in thermal ionization applications and demonstrates the immediate value these acquisitions have brought to our customer base.

We are actively and further, we are actively collaborating with this customer on additional projects to deliver tailored solutions. These collaborations further cement our role as the customers power solutions partner. Our long standing relationship with this this customer illustrates the effectiveness of our strategy positioning XP for continued growth and success in the global marketplace. I just want to now turn from strategy to operational performance. And the progress we're making. In our product portfolio, as I said, we've been stepping up our focus this is starting to pay off.

We launched 13 new product families in 2024 and expect to release more than double this in 2025.

These are predominantly addressing white space in our portfolio, and will deliver further growth in the medium term.

With customers, our project pipeline is growing in both volume and value, and we are sampling more and seeing growth in the overall value of the sales funnel. And customers are liking what they're seeing from XP. With our customer net promoter score improving across all three regions. Our supply chain is performing well. The lead time is reduced. Well as inventory and we're shipping more product by sea. And our staff engagement score has held up despite the challenges we faced in 2024. And we've continued to deliver on the environmental side. The key point, we've been working to improve our business strategic in and operation while we prepare for the market recovery. Sustainability is one of the most critical items on our customers' agenda and we are confident that we're still leading the market. We're ahead of our targets that were approved in February 2024, and we continue to make progress on the agenda reducing our carbon footprint. 100% of our electricity in our EU operations is provided from renewable sources. Achieved the Ecovadis bronze medal status in the year, an improvement on the prior year, placing us approximately in the top third of businesses assessed. All our sites are now single use plastics free.

And sustainability is further embedded in our innovation process with new internal carbon rating of products. Which our customers have been requesting. Customer feedback shows we are still ahead of the market. We believe we are still leading our industry in sustainability It's not only the right thing to do, but it will bring significant benefits to XP Power in both cost reduction and in customer engagement. And then finally, turning to our outlook. The markets are definitely improving. But it remains difficult to to predict exact timing of the recovery which brings the wide range of outcomes to 2025. The share placing has strengthened our balance sheet, so we're prepared for all outcomes and we will look to return this to shareholders as soon as we're in the position to do so. Looking forward, we are well prepared for the market recovery. [indiscernible] confident the end markets will resume their long term growth trajectories. Our well established customer relationships in the right sectors provide clear growth opportunities and we have a healthy pipeline of new product launches and design wins. Our supply chain and manufacturing teams are focused on driving further operational efficiency. So in summary, well positioned for growth as the market and order levels recovery.

On that note, I'll open up to Q and A. We'll start with questions in the room. Before taking For those in the room, for the benefit of those joining via the webcast?

Thanks, Lydia Kenny, Investec.

Just two quick questions from me. How are you managing tariffs Obviously, you refer to the Biden administration. But just the Trump situation as well? And then on Malaysia, could you give us more information on the costs [indiscernible] to do with this. When is the expected completion and how quickly capacity could ramp up there? And if going to transfer any of the North American I guess, manufacturing to Malaysia as a result of what's going on? Thank you. Okay. Shall I take the first one and you take the second? [indiscernible] tariffs, we went through so the Biden administration was focused on limiting the progress the Chinese semiconductor industry would make, and they've been reasonably successful in it. They introduced they added 130 customers to their entity list in December 2024, we had five direct customers on there. And we had two customers, one in Japan, one in Taiwan. [indiscernible] had their end customer on their entity list. Need a license to supply these customers. We have it only for one customer, which will expire in in August. So that's the controls on the hearing. The next stage will be tariffs. The Trump administration were placing in We supply very little product from China into The U. S. Following the tariffs that put in place in 2018, the majority of our U. S. Customers qualified Vietnam.

And essentially, we use Vietnam to supply The U. S. If there are any tariff win so tariffs came in on China today, We will look to fully recover those from customers, which we successfully did in 2018. I'm I'm generally not concerned about that. Yes, Paulie. With regards to Malaysia, so construction has restarted. And the plan would be to finish the construction of the building itself by the end of this year. We wouldn't though be paying for all of it this year because we do get payment terms from the general contractor. If I was to estimate, I would say the £10,000,000 that we still have to spend, roughly £7,000,000 this year dollars 3,000,000 in 2026. Once we've got the building complete, obviously, we then need to fill it with plant and machinery and fully commission the site. Obviously, we can go as fast or slow with that as we wish to. I mean, it would take three to six months. So theoretically, we can have a fully functioning facility by the Regards transfer, we're proceeding with that anyway. So it's not conditional Pomalacia. Plan A is to move at least a chunk of that currently U. S. Volume into Veer.

But to still to produce some of the items in The U. S. Because that is a sort of requirement of the customer. Obviously, any items that we do make in Vietnam Malaysia for that matter. Would come with a a lower production cost. So it is a it's a helpful leg to our kind of continued gross margin recovery.

Sam, Tom Elgar, Deutsche and Numis. Two from me. Just wanted to unpack in the color you gave on that industrial technology piece around the different regions. So North America and EU ahead of Asia. So anything you could give on that would be great. And the second was around the commentary you mentioned around sort of the high drop throughs in terms of the recovery and obviously the cost actions that you guys have had and obviously monitoring. That situation and maybe perhaps sort of dig into that and when it comes and how that will look given on the downside we've had 50% drop throughs, what it could have like Thanks.

Split is a four?

Yes.

On Industrial Tech by region, we're seeing Europe and North America recover quicker. [indiscernible] the ongoing controls in Asia in China. China is the rice bowl of Asia. If that market is sluggish, then that does impact the overall piece. We're still being we're still seeing wins. Still seeing progress. Just it feels like it's behind behind North America and Europe. We've all read the well documented issues in China, still think it's an attractive market, still think it would drive good growth for us in other sectors, predominantly in industrial tech, but also in healthcare. So we still think it's a good opportunity. And wider in in Asia, we're seeing good momentum in India. Just taken our largest order in the healthcare industry it's we've been there circa ten years and it's now starting to deliver high of [indiscernible] revenues. In Korea, the currency challenges versus Japan is probably the thing that's holding us back. But overall, we're seeing it's just slightly behind what we're seeing in Europe and North America.

Regards drop through, I think you're being a little unfair with the 50% drop through on the way down. It was profit reduction versus revenue reduction, the drop through was a great deal less.

Yes. It would have been 50% drop through were it not for the overhead reduction that we that we made. Mean, I think the good news is on the way back, I don't really feel like there's a lot of cost that needs to be added back. Obviously, We're flagging 5% sort of mostly inflationary inflation increase for 2025. If you were to ask me, is there additional resources or heads that we really need in the business, as volume recovers, aside from direct labor, I would say no. [indiscernible] your question. So I think that is the promise of the recovery is that it will really drive us towards much better margins overall.

David Farrell from Jefferies.

I'll probably go one by one if that that's okay. In terms of the Asian semiconductor numbers, you've called out that big 8,000,000 pounds of revenue. If I look at the net debt to EBITDA bridge, [indiscernible] turns, which is £15,000,000 So can you kind of bridge that math for me, please?

Yes.

It's not quite that not sure that math is quite right, David.

But I can tell you exactly how it's calculated, if that's helpful. So you're right with the £8,000,000 broadly.

The drop through on the £8,000,000 is essentially 60%. And the reason why it's 60% is because the business itself, the margin is quite healthy. Is an element of factory fixed cost that stays fixed. So if you do those maths, trust me, it does come to be 0.35.

Then maybe just to push you on the weakness in Q1 revenue and why that would be surprisingly weak. I can't remember exactly how you termed it, but I'm going to suggest it wouldn't be normal.

Yes. So I think [indiscernible] I'd say that I didn't cover the orders. The orders look [indiscernible] The revenue sometimes is affected by the phasing of deliveries particularly when the quarter starts with a holiday period. I don't think there's too much to read into. That Q1, but I just wanted to release flag it to you before we get to the end of Q1. That it might look a little bit weaker due to the timing of deliveries.

Then my final question, if I just go to your kind of scenario testing in the release, I think it's plus 1% minus 3%, minus 9% in terms of kind of revenue. Maybe just give us a flesh those out, what the assumptions are behind them, perhaps even referencing particular end markets?

Yes.

So I'll give you some detail on that. So I think the scenarios would range from I think what's common well, so I think the H1 numbers are broadly similar between those cases. Because we've got decent visibility of that first half. The range is created by the second half.

So at the sort of top end, you have an end of destocking at the end of the first half followed by a market recovery.

In the second half, perhaps the market recovery also drives some restocking. That would drive that scenario. At the bottom end of the range, you've basically got not that we expect this, right, we have we are required to do a severe but plausible downside scenario here, right? So in the bottom end of the range, you would have continued destocking. Effectively for the entire entire year. [indiscernible] James Mayless from Berenberg here. Two questions, if I may. Can you just elaborate on comments around returning placing proceeds to shareholders when the markets might recover?

Have you got a sense of what that could look like? Is that just organic investment back in the business or something more Kind of bespoke in nature. And then secondly, you made a comment average sales lead times have reduced by three point two months. You have a sense of how much of that is just end customers themselves reacting to lack of visibility in the market? And then when we enter some form of market normalization, how you'd expect that sales cycle to trend?

Okay. Return on the we recognize the fund raises, the placing raise this morning. We may have raised too much. There's a wide range of scenarios we've highlighted. What we've committed to is, as and when we're in a position to, we will return it to shareholders. Potentially through a share buyback or other means to be determined at this stage I think the point is we're committing to return it committing to make returns to shareholders as soon as we possibly can. Okay? On the sales lead sales cycle lead time, yes, we've been working overall supply chain has improved. Our lead times have come down. And we're they're still coming down. We're working to an to an average lead time in in line with historic norms, but with our two largest customers, [indiscernible] semi industry, we've committed to lead times significantly below average.

So we think and we're looking at how do we how do we improve that on an ongoing basis? So it's the same for all customers.

Thank you.

Good morning. Thomas Ransom, Davy. Just to follow-up on the The U. S. Volume going to Vietnam, just can you put that in context of what you've already done over the last few years of moving that volume because from memory there was quite a bit that has been moved over over the last four or five years. And then just what the latest kind of cost differential is between U. S. Manufacturing and that Vietnam manufacturing, just give us an idea of any potential upside? I'll take the first. You take the second.

So yes, we've had an ongoing program to move transfer production from North America to Asia to both Vietnam and to China. The for product going back to The U. S. It's been to Vietnam. For product going to Asia and Europe, it's It's been added into China generally. So what we have done so far, we have we've completed the transfer of bespoke solutions we provide to customers from California to to Vietnam. That's ongoing as we do as we win new products, Essentially, we design and prototype [indiscernible] in California. And then we've moved to high volume manufacture to Vietnam. We've also been looking at transferring both high voltage, high power from New Jersey and for an RF from Massachusetts, and that's been pretty successful during 2024. The challenge, these are very these products are very integrated with a the customers product that part of the process. So need further qualification and approval, which we've been working through. So it's been relatively but with more to go.

Okay. So in respect to the cost differential, so to the first approximation, you could think of these products transferred as being group average margins? So that means 60% of the revenue is COGS. So what we're changing is that 60%. Of that 60%, 50% as in half, is raw materials. We could get some saving there, but that's not really the main aim. It's more around the other half. [indiscernible] So therefore, that's 30% of revenue. [indiscernible] the cost and mostly that is driven by Asian labor rates one way or the other, right? Even if it's an overhead, it's a labor rate ultimately. The cost of that in Vietnam is probably one tenth of what it is in The U. S. So you can do the math from there and you can work out that it's a [indiscernible] Great. Thank you.

And then second question comment and obviously the January update that you gave and then the line in the presentation saying the appeal mid this year. Has that timing changed from previous conversations? I thought there was maybe a kind of a shorter time period between any outcome on those or a decision on the costs and then the appeal or the appeal has been waiting for that kind of outcome. Any comment on that Appreciate it's sensitive.

So [indiscernible] [indiscernible] ruling in January On fees and interest, while slightly higher than expected, was helpful because it does free up the process for the appeal and to get this closed down. The appeal would be to a new to the Ninth District Of California in San Francisco we've had indications from them that it will be in the summer. Have already scheduled the appeals for May. We're just waiting to hear are we in June, are we in July or are we in August. [indiscernible] Hi, sorry. Can I just follow-up on that in terms of the cost of appeal? In terms of potential for legal costs? And then if you lose the appeal, do you have to pay comments, legal costs all over again?

The expected appeal costs are sub $2,000,000 of which the majority has been incurred already. It's a one day court appearance. So it's a low low level cost. There's no jury involved. So it's much, much lower cost. And potentially, but they're provided in our outlooks.

Okay. [indiscernible] So we have one question from kind of the web portal. So the question is from Kevin Fogarty at Deutsche.

When will will your existing order book relating to the semi conductor manufacturing equipment sector in China likely be fulfilled. [indiscernible] And second question is, can you provide any color on the scope for any further inventory on wine potential in 2025? Given today's updated guidance.

Okay. Say it again. [indiscernible] The requirement to ship to the customers that have been put on the entity list is to have a life with immediate effect.

We only have licenses for one customer that expires in August. Therefore, we have stopped shipping to them with immediate effect.

Regards further imagery unwind, I mean you would have seen from the slide that we've from the peak, you might say, towards the end of twenty twenty three, we've reduced the inventory by a third or 32,000,000 mean, at this stage, it's pretty well optimized. There is some extra that we are targeting. In the first half of twenty twenty five in the sort of single digit millions kinds of range. Obviously, what we want to do is to ensure that we are able to provide excellent service as demand recovers. So we try to balance obviously cash with that.

I think that comes to a brings meetings to an end. So thank you for joining us today. That this marks the end of today's full year results presentation.