Fonix (FNX) Mello Results Show Conference summary

Business model and market position

• Provides SMS-based technology for interactive campaigns, powering major U.K. radio and TV competitions and charity donations.

• Acts as an aggregator, integrating with all mobile operators to deliver high-throughput, real-time services and reporting.

• Ensures fairness and auditability in prize draws, supporting major campaigns with robust, regulated platforms.

• Holds a dominant position in the U.K. and is expanding into international markets, leveraging a scalable, capital-light model.

• Focuses on gross profit as the key metric, with 80% of profit from media, and maintains a high dividend payout policy.

Growth strategy and international expansion

• U.K. remains the core market with steady single-digit growth, but international expansion is accelerating.

• Ireland (live since 2022) and Portugal (launched September 2023) are early international successes, with Switzerland and France next.

• France represents a significant opportunity, with EUR 100 million market potential and EUR 5-10 million GP target.

• Expansion is capital-efficient, typically requiring only a local manager and leveraging U.K.-based operations.

• International growth is expected to contribute meaningfully to revenue and profit within 12-24 months of market entry.

Product innovation and new revenue streams

• Developing new products like PayFlex (payment recovery for failed SMS), CompsPortal (online competition entry), and RCS messaging.

• PayFlex is expected to reach a £0.5m annual run rate in the U.K. alone.

• RCS messaging enables richer, more interactive campaigns, targeting a broader £1.2bn U.K. prize draw market.

• New products are designed for both domestic and international rollout, supporting further growth.