Austin Engineering Limited (ANG) Earnings Call Transcript & Summary

[Audio Gap] [indiscernible] front row, but they missed themselves around a little bit. So representatives from the company's auditor, BDO, up here and will be available to answer questions on financial statements in relation to the audit. The Company Secretary has informed me that we have a quorum present, and I therefore declare this Annual General Meeting of Austin Engineering Limited open. I'm pleased to advise that the shareholders that are not able to attend physically are able to watch and to listen a live webcast of the meeting. The webcast will be an opportunity to view the proceedings of the presentations at the AGM and the shareholders to submit online written questions during the meeting. However, the webcast is provided for convenience only and does not replace a physical AGM. Shareholders will not be able to participate in the meeting or vote via the website facility. Given the logistics and the fact that people watching over the webcast facility are not taken to be present at the meeting, we propose to address any questions that are sent through over the webcast at the end of the meeting and once the meeting formalities are concluded. I'd like to explain the format of today's meeting. Firstly, I will give the Chair's address. I will then invite David Singleton to give the Managing Director's address. And after David's presentation, we will consider resolutions outlined from the notice of meeting. I'm pleased to report a decent year of progress from operational perspective. Our Austin 2.0 strategy [indiscernible] business, and I firmly believe the company is now well set up for future growth. This year hasn't been without its challenges. Most notably, these include inflation pressures faced by the mining equipment sector, particularly in relation to steel prices and the shortage of labor and qualified trades, especially in Australia. However, measures to put in place under Austin 2.0 strategy have seen Austin centralize some of its production and secure supply chains to improve margins and to shield it from some of those pressures. Cost reduction initiatives and improved manufacturing efficiency together with new product launches and the integration of Mainetec resulted in a higher full year revenue across all of our business units, as bid win rates also improved. For the full year, we recorded a 27% increase in group revenue to $258.3 million with an 8.4% rise in the underlying NPAT to [ $18.1 billion ] and 9.5% rise in underlying [indiscernible] $31.3 million. We see the revenue project rate continuing, as we build the business and the impacts of revenue diversification continue to manifest. We have revised the first half 2024 guidance for an approximate [indiscernible] increase in revenue year-on-year and at a approximate [indiscernible] in underlying NPAT. We've also started full year 2024 with an order book covering around about 50% of forecast for the full year revenue compared to 40% at the same time in the previous year. In his address, David will give more details on the initiatives undertaken by the company to increase orders and sales on the new products we brought to market, supported by the integration of Mainetec into the business. I'd like to particularly highlight our achievements around the expansion of our Indonesian facility, hub in Batam, and the rollout of our AustBuy procurement program. These are 2 of the larger strategic changes we made in the business for some years, and I believe the benefits of each will lead to growth and returns. We have doubled the size and capacity of our Indonesian facility, upgrading the fabrication capabilities to reduce our whole suite of products. In a period of critical labor constraints in Western Australia, we have been able to redeploy some of our manufacturing through Indonesia. We have a committed and available team. The expansion of Indonesia has coincided with the return to pre-pandemic freight rates, and we have been able to ship products from Indonesia to customers globally. We see its importance as a lower cost manufacturing hub and the growing, as it provides a ramp up support to other business units. AustBuy is our global procurement program, allowing us to buy goods at volume, particularly steel at better prices, driving down significant business costs and allow us to manufacture and deliver to customers at competitive prices. We continue to show we are a market leader in engineering and design solutions. We are meeting customer's requirements for innovative products that provide increased operational efficiency, safety and aid in the pathway to decarbonization. Demand for mining equipment is being driven by both traditional commodities and the demand for critical minerals supply as well move to increased electrification and renewable energy sources. Pleasing, the level of recurring business has increased as existing customers look to Austin for replacement of fleets and equipment of repairs and maintenance. In the year, we have launched lighter weight and more efficient products designed to reduce steel requirements, increase payload like and minimize fuel and tire usage. We are exploring new markets such as India and fewer markets for new products like underground Pacific equipment, all with potential to further diversify our revenue base. The full benefit of Mainetec is also starting to emerge. Our operations in Queensland have been complemented while the establishment of a special bucket fabrication facility here in Perth, which can produce the entire range of Austin and Mainetec buckets. As we hoped, the team has successfully forged a path for international sale of Mainetec buckets with the first dipper bucket sold in the U.S., where there is a greater market opportunity to explore. The health and safety of our people remains our core focus, and we have continued to offer programs and initiatives to support the health, support and well-being of our staff right across the globe. It has been important to attract and retain staff, especially in jurisdictions where [indiscernible] are being built. We had a 75% increase in apprenticeships this year compared to 2022. All of our apprentices are often full-time roles in the company. We want to make sure that they've given opportunities to further their careers within Austin Engineering. We have taken on more staff in Batam, following our expansion in operations and that has necessitated the need for more training and upskilling. Our quality control welding program has been well attended as our in-house welding training program, which recently employed a group of female welders. We are pleased to release our second sustainability report last month that details Austin's environmental, social and governance credentials, and we'll give you a full picture of how we're creating sustainable business aligned to our core values. On behalf of the Board of Directors, I'd like to thank David Singleton for overseeing productive here at Austin, implementing his Austin 2.0 growth strategy, while navigating facing pressures and lingering labor issues, especially in WA. He has built a strong executive team, which is ready to build a stronger, more integrated global business. We have growing workforce employees as well as the contract and supply groups, who are all committed to Austin's successes. Thank you for another year of support and making sure safety and safe work practices [indiscernible]. A great thank you also to the directors for their guidance and counsel through the year, filing to our shareholders who have continued show support for the company's strategy and vision. I will now hand over to David Singleton for your CEO and managing director's address. Thank you.

Good afternoon, everybody. I'm conscious with these presentations [indiscernible] one of those is those of you who take the time to turn up today just to see the Board and here to speak about business. So thank you for taking the time [indiscernible]. But I'm also conscious that we've talked to another audience, which is the institutional -- largest institutional shareholders. And the reason that we have the camera and the microphone here is that many of our institutional shareholders on the East Coast only -- of course, on the East Coast of Australia will be listening in today to see whether we've got anything new to say. So with that in mind, a little bit of what I'll do will be repetitious of what people already know on the East Coast. But [indiscernible] taking time to come here. And so it will be a little bit new as well and I'm trying, if I press this button, but I think things are fantastic. So this is historical news, as this is the financial results of the end of the FY '23 period. And Jim has just have you a little bit of an outsight in that, although I will run through it just quickly. So nothing new here, but [indiscernible]. Group revenue was up to $258 million. That was up 27% on last year. In fact, our revenue and our growth has kind of played out and stuck around $200 million for several years before we got going to the Austin 2.0 strategy and so on. I'm delighted that we're starting to see the sales success and the strategic success that we think we have inside the business actually turning up in the results of the company. The numbers, of course, are at the end of the [indiscernible] works very well in financial results. We've told you whether or not the things that you're doing are actually delivering the results that you want to achieve. So we're up 27% on sales. Normalized EBITDA and normalized for some one-off events, was up 9.5% on the previous financial year. And our normalized NPAT was up 8.4% that previous year. And I think if you think about the -- if you talk about the ASX top 50 companies, and they have those kind of percentage increases and the results that have been seen as a really exciting outcome for the business. [indiscernible] operating cash flow. This is the other big truth teller in our business. It is something to achieve profit, but if you could match that off with operating cash flow, then that starts to tell you that the business really is truly profitable. And we had an operating cash flow [indiscernible] $15.8 million. That's up nearly 2.5x on the previous year so that feels like we're now seeing results coming through as cash flow for the business. And the thing that gives us a little bit of a forward confidence about how the business is traveling going forward is that despite the fact that group revenue was up so much, the order book is up 35% on a year-on-year basis to $143.7 million. And so very strong [indiscernible] invest in mining services companies as well. We are a different type of business to that. Our long-term contracts for us are typically a few months. Many of our contracts are a few hundred thousand dollars over a few million dollars. We don't receive multi-hundred dollar contracts, and that's not our type of business. We're a fast turnover [ rare ] products type business and business comes in on an almost daily basis where for us to be able to see more about 6 months in advance. But that's what we can see and it typically gives us the kind of data that we [indiscernible] is going to. Interestingly, I'll talk [indiscernible] 89% of our revenue comes from long-term customers with recurring income. I think many of the statistics that we use, this is one of the most interesting and most important because it sets its reliability and consistency in our business because we're seeing same customers coming back and buying either on an annual basis or on a semiannual basis. So I think from an overall point of view, that's a good set of results. How do we feel about that? I don't think we feel ourselves very satisfied about that. One of the things that's important, I think, running a business is that you never feel satisfied with results that you achieved. And you're always looking to do next year improvement more than you've done in the previous year. So we think there's still a lot more to be done and a lot more to get out of this business than we have achieved so far. So if there was a pace of change and the pace of the determination last year on the back of what's been achieved, I can tell you that, that pace of determination not only remains it's even higher as we move into FY '24. So if you just look at those results on a comparative basis, on the left-hand side is the return on equity. And you can see that we deployed our capital really well in this business. We've seen returns on equity going from 6% to 9% on the left-hand side of that first graph now rising consistently to around 16%. I think all of us, who invest our own money, would be very excited if we thought we could put money into an investment, basically achieve a return on investment of 12% to 16%. Even on a risk-adjusted basis, that's a very strong return so we're using the funds inside our business a very effective way. The second graph on the right-hand side, it shows whether a historical run rate of EBITDA had been for some years around the early 20s, and we've now looked back to the sort of early 30s with an exploration to improve that significantly from acquisitions. So when we look at it on that basis, it's been a good step. Is it enough? No, it's not enough. And we have much more to do with the business in that. So I'll talk a little bit about strategy of business, some changes, also development [indiscernible] strategy, what underpins all of the things that we've been doing over the last year or so. Our strategy is really guided by 3 things. It's interesting, actually. I spent my career working in strategic parts of the business, running businesses with strong strategy. It's the first time I've ever managed to boil down the strategy of the business to 3 points. I think it's because I'm getting older and my memory is not as good. [indiscernible] 3 points, not [ 15 ] points. I mean, it's a very clear and guiding strategy for us. It's complex in terms of the way that we have to implement that. But it's very clear about what we're trying to do. The first 2 steps are creating a foundation in the business on which we build everything else. And the first one of those is they have manufacturing which -- so what is -- what this is about is creating a differentiator in this business -- strong differentiators in this business that makes it hard for others to compete directly with us. And every time I think about strategy and when we think about -- when we talk to our business units about strategy, we're trying to create the situation whether we open up a gap between what we are capable of doing and what our competitor capable of doing. So this is fundamental to well-developed strategy in any business. It's not about run your businesses and achieve what we're trying to do. We simply do that because eventually, someone will come up with a better solution than we've got. What you have to do is come up with better solutions upfront so you maximize your position. Now what we've done in manufacturing, and I'll talk about one of these things a little bit later, is a couple of really important things. First of all, we realized that we were buying major materials, particularly steel. We buy a particular type of specialist steel for our products, a high and hard [indiscernible] type of steel, but we were buying it around the world globally. So in the U.S., we bought it locally from stockists. In Australia, in Indonesia, in Chile, we buy from stockists. And that's a pretty easy and straightforward thing to do. You would an order for a couple of things, you buy some steel and you convert that steel into the product. Anyone can do that. It's pretty straightforward to do. You've a small shop. At the present shop, you can go ahead and buy some steel and you can [indiscernible] design, but nonetheless you can go ahead and buy it. What we've now done, and Jim mentioned this in his speech, is we've moved to the AustBuy program. What the AustBuy program does is it collects the total demand of the business across all of those regions such that we now buy around about $100 million plus of steel essentially, and then we allocate that through to business units. That's created a significant cost advantage in our business that can only come from scale. So if you don't have the scale of our business and nobody else does around the world with the biggest of what we do in customized products, then if you don't have that scale, it's hard to replicate those financial benefits. And we're buying steel around about 30% cheaper than we used to pay for it before we're looking AustBuy program. So you think about half -- roughly if you look at our results, you'll see about half of our cost base is materials, and we are buying those materials significantly cheaper than wearable before. And that starts to create difference. The second thing that comes on the manufacturing [indiscernible] talk about, which is manufacturing [indiscernible]. Because the reality is that here in Australia, we are heavily labor constrained. It's a single, most significant issue here in Australia, is access to like all the way through the management channel and all the way through into the manual over. And that situation you also now true broadly in the United States as well. We have the same issues in the United States. So we're going to a hub to manufacturing process, which is to do more of our product in Indonesia. It's allowed us to create capacity around the world to deliver. This is capacity that previously like everyone in the industry struggling for capacity that we have been creating brand new capacity in the business allowed the business to grow. I'm pretty clear in my own mind that we would never have got to $258 million of revenue last year without the capacity we put on. We got close just -- being able to do that, and we wouldn't have been able to drive even for this year. So 2 really important parts of manufacturing -- a lot of other things as well, but 2 really important parts of the manufacturing. The other key to strategy is to have product leadership. And then I'll talk about this a little bit later, but it's relatively to have low cost and capacity on your side, but you also need to have the best products so people actually want to buy your product. And the kind of the dream ticket for any manufacturing personal -- the dream ticket is to be able to build the product at the cheapest price, but people will like to pay a premium because you've got this product. You can get into that area. Posh cars probably fit into that kind of category. If you can get into that kind of environment, then you can really open up good margins for our business, and I think we're steadily moving in that direction. And the next element where we have just updated our strategy. We had on here before about cost leadership. That's not important anymore but that's essentially done -- driving down our cost base in our business has been done. It's being held inside the business now. And so we moved on to think about how we involve ourselves with our customers much more effectively than we have done before. And as part of that, I've authorized an increase in expenditure in Australia, increasing the sales force dramatically, an increase in the United States in the sales force and Chile as well so we can start to engage more effectively with our customers. As we'll see the success of that we do, we may allocate more funds to that progress -- so we do that more effectively. So it's a new advantage, but we've really started with similar -- in the last few months. So I'll talk a little bit now about the business units around the world and just sort of talking about a few headline points. First of all, one of the difficulties that we did have last year was that our Australian business was not profitable for a whole number of reasons that we've gone through before and what we're going through right now. But the simple news is that in the first half of this year, we are profitable in our Australian business, and that's a big step forward. I have to say that we have been very profitable in Australian business in the past. And so it's been a concern to us that we've not been able to repeat that recently. The business has now returned to profitability. What you can see on the screen, over there -- on the left-hand side, is an [indiscernible] in the Middle East, business in Mackay, in Queensland, which is a Mainetec business, which joined us in October of last year and then another business that we have in the Mackay, which [indiscernible] 3 main operating units. I think the change in Australia perhaps though, and this is kind of a big factor in that if you go back to around about 2022, well, the year before we bought Mainetec, we had a very small mining bucket business. In fact, I think in Australia, we built 5 offices buckets in that year. So it's quite a small part of our business. What Mainetec is intended to do is to help us to change the nature of this business so that it had another sort of manufacturing product-led market inside of the business other than truck tray business. And so we invested in Mainetec on that basis. I think this acquisition has gone phenomenal on the impact that it's had here. And I'll give an example of that. We have moved truck tray manufacturing line out of Australia up to Indonesia because we just did not have enough capacity to run that line here in Australia, just couldn't get enough workforce for it. So that took about 85% of our manufacturing [indiscernible]. Now producing mining buckets that shop is thoughtful again. And we are still struggling to get one. So we took 85% of our work out the shop. And now the shop is full again, but this time, with Austin buckets and the Mainetec range of buckets again. So we've created this kind of vacuum inside the Australian business. And what happened is that's been filled with new product, which is mining buckets, an area where there's limited numbers of customized -- very limited numbers of customized builders here in Australia. So that's been a big step forward and it's allowed us into new markets. This product on the right-hand side is a dipper bucket. These are USD 2 million piece -- by far our most expensive single product. And we sold now our first one of those to this Mainetec design in the United States recently. I think we announced back in the last calendar year. That's going into production now. And it's a really interesting example of the strategy that exists in the business and that this concept was done by Mainetec. The detailed design was done by Austin in Perth. The manufacturer will be done in Batam in Indonesia, and it will be delivered into the West Coast of the United States. I don't know that we've ever really joined up our business in quite that way before. And it's had quite an impact. If we go back to FY '22, if you look at the yellow segment of that flight chat there, that was the percentage of buckets and associated products in our business in FY '22. We go to FY '23, and 16% has now turned to 29%. So the result of that acquisition of Mainetec is now we're seeing much better obviously across the board. And I don't think it really got going yet because we are pushing hard to get both sales into North America and into South America by the Chilean business as well. And I think there is even more opportunity in North America and South America than we have seen in Australia. So lots of potential there. These couple of shots from our business in Caspar. This is a real cowboy country. This is the walk down high street Caspar and you can buy yourself a leather saddle and a pair of hand tooled boots and Stetson hat. This is -- when you the Wild West, this is it. This is absolutely main street Wild west. It's a great business for us. The core part of their business is building these ultra-size trucks as well as other things as well. Ultra-size is the biggest one. This is actually a picture of the largest truck body on a truck ever built anywhere in the world. It's actually a picture that's in the Guinness Book of Records. This business has been growing quite dramatically over the last few years. If I go back 2 years ago, had modest profitability, modest -- very modest growth. They have really surged over the last 2 or 3 years. Part of that is a cost-cutting program [indiscernible] a lot of that is that the U.S., now is getting to convert more rapidly towards the Australian model, which is driven by the inability to manage labor on their mine sites. They've lost a lot of that kind of labor, in the same way that we have you in Australia. They want to [indiscernible] mine sites. They need much more efficient equipment because they want to reduce their fuel burns, and they want to be more efficient about the logistics of their business and so on moving away from OEM style equipment, moving towards customized equipment. And every time we convert a mine -- a big mine in the United States to customized equipment, they'd stick with it. And so that 89% conversion rate that I talked about before, gives you an example. New news that we announced recently is the Wyoming step -- Wyoming state through the Wyoming Business Council, have advised us of the USD 20 million investment that -- sorry, grant and one facility that is being made in order for us to be a new facility in Wyoming in the Caspar side, where we have unexposed. And that facility will allow us to only modernize what we've got at the moment to try and reduce the labor content, more automation, perhaps than we previously had, but also to increase capacity because that business is growing. It's now got to a point where it's starting to hit its capacity limits. This investment is subject to final board approval. And the reason why that position is in place is we're very keen to make sure that the investment we do in Wyoming is a future-looking investment, not just in replicating the way that we have done things in the past. And I would like to think that we will be ready to really keep this off in the early part of next year. So it shows a great confidence in the United States in that business. I think it shows confidence in us in our determination to invest in a newer state. The Batam has grown at an enormous rate over the last 2 years. I've been saying publicly that our business will very soon about 5x as big as it was 3 years ago. And we're somewhat on our way to that target. If you remember that what we did was we designated that this business will essentially be a half [indiscernible] manufacturing. What that actually means is we've retained our businesses in Chile and the United States and in Australia, and that business continues. But where we get our capacity expansion from -- is from Indonesia. And so we are already delivering from Indonesia into the North of Western Australia directly into [indiscernible] other customers. We're delivering on to the East Coast, Glencore, Yancoal and other customers directly out of Indonesia into northern parts, delivering into Europe. We've completed some deliveries into Europe recently, Africa quite regularly, particularly in North Africa. And we have made -- started to make deliveries now to Canada, the United States and even into Mexico, which is kind of interesting because I would imagine that I would have a pretty low cost centered, probably been delivering into Mexico as well. And I think what you can expect to see as we go through the following months that this style of manufacturing, this ability to increase capacity or just grow, grow, grow and we would expect to see some interline between Batam and Chile in the future as well as some of those products that get sold down there. They will get built in [indiscernible] geography. Expansion refers to a target to get to 30 tries a month out of the time we're very close to hitting that target [indiscernible]. South America, so this is our business in [indiscernible] in Chile. We actually have [indiscernible] Chile today. And we've got [indiscernible] down in Australia. The Chilean business is also we've seen a transformation in our business over the last couple of years. It's a perennial loss-making business up until 2 years ago. They had a reasonable year last year -- sorry, the end of last -- good year last year and it got off to a really good start this year financially. And so I think that business is really starting to improve and develop. But the very positive news that we've got in Chile is that we have been awarded a first very small part of what I think will be a long-term multiyear contract with 1 of the major all truck OEMs around the world to build the truck trays on that to build on their behalf. So we're building [indiscernible] but it's the beginning of what I think will be a major increase in the Chilean business that will start this year, and we'll really drive into FY '25. Now these sort of things are really important because you saw that our business level is at 89%. If we can win these big programs, multiyear large programs in our business, they will continue to underpin this business as they go forward. And I think in -- I think we'll be standing here in FY '25. We'll be signing this contract that started in [indiscernible] back in September or part of October, which we've been pursuing for 12 months now, landed finally in the end of September or beginning of October. I think I'm looking at this in a year's time. We said this is a major strategic acquisition that we have achieved in business, which really compelling growth down and I'm really excited. These are sort of customers that we've been winning across the market. You can see this is kind of like the blue chip list of customers around the world. [indiscernible] we delivered directly to particularly in North America, but also Australia as well, delivered directly into Komatsu [indiscernible] customer says I want to buy a faster track, but I want to note structure on the back and you can see some of the major miners on the left-hand side, [indiscernible] Newmont. So these are Suncor, Nevada [indiscernible] major mining companies in North America, who will just buy every year by significant form of these truck trays from us, and we hope particular importance of buckets into the future. So I talked about 89% of our revenue comes from big customers. The way that's made up is about 56% of our revenue is from customers, who buy on a regular basis, normalized basis, year after, year after, year. An example of that is Rio Tinto. Every year, we sit down with Rio Tinto. So this is our demand for next year and tell us what their future demand is and they start posting purchase orders as they go through it. We have several contracts like that in North America, in Chile and in Australia as well. So these are annual return. And we have another bunch of customers who may be a little bit smaller, and they regularly buy from us, don't necessarily buy every single year, but regularly buy from us when they buy it. They pretty well on and buy from us. And that's what makes up our 89%. And then there's just a little bit of [indiscernible]. This is what tells us that putting more work into the sales function so important because if we win a new customer, bring a new client on board, the changes are we going to keep for many years after that what we're going to tell. Right, so this is those people who are online are interested in [indiscernible] everybody online is focused on and the market we'll be thinking about, and this is the [indiscernible]. We gave our guidance for first half, will go through a year. The first thing I will say is that the market conditions across all of the jurisdictions remain very strong. You might ask yourself why is that because opening is that the interest rate is going up, the demand being strangled by central banks. But actually, we would see demand come back. The reality is I think most people have been in the industry, this is one of the few times that we're saying commodities across the board being relatively strong on historic levels. So it doesn't matter whether it's LNG, whether it's oil, which is important to our oil sands business in Canada for instance, whether it's hard rock like nickel or copper or new age [indiscernible], iron ore, even coal. Most of these resources are stayed very strong. And although you'll hear people talk about iron ore is down $10, the reality is it's up and down on a relatively high level compared to their long-term averages. That means that most of the mining companies help of cash -- good cash flow and therefore, prepared to invest in making sure the logistics work effectively, and that means to make sure that we place products as well. We are seeing very solid position here in Australia. I wouldn't say it's stronger than last year. I think it's kind of flat compared to last year, where we are seeing a lot of growth is in the United States and Canada, where I think we're getting more mining companies and perhaps in the past OEM equipment, starting to convert costs more rapidly into customized equipment. So it may be that the market is still not growing that far but the market share of customized builders such as ourselves is growing quite rapidly. And we are, by far, because customized producer of truck drives in the United States. And Chile probably a little bit softer than that. [indiscernible] in Chile perhaps not quite strong. So a little bit of softening [indiscernible]. But again, Chile dominated by copper, which is 1 of those minerals that will be strong in the new market and -- the electrification market, therefore it's got a fabulous future. And I feel pretty confident in that as well. So we're seeing good demand. I wouldn't say it's significantly stronger than last year, but I think it's still very strong and appears to be continuing irrespective of what we see in the broader markets around the world. Our order book, which I reported was up, is up another 7% throughout the year-end. So I think I reported earlier about $143 million. Our order book is up 7% since then. So that's -- we had revenue going through. The revenue has been good. And we've replaced that revenue more quickly than we have consumed it. So that's good. And a 9% year-on-year since this time last year -- we're 9% better than this time last year. So the order book sort of data, if you like, is supporting what I said earlier, that the markets have remained strong because our market share is continuing to grow. Australia, I think a key feature is that we're confident that -- very confident that we will see a profitable Australian business in FY '24. We had -- we carried out a major repositioning of that business like of what it used to do, to what it does now so there's much more on mining buckets. That's been a pretty intense and difficult too , I can tell you. But I think it's a new business now in Australia. It's newly configured. We've got lots of things to do, but starting to see the profitability of that business. And that's really important to what comes next, which is we see revenue up. And if I take the average of that $139 million, it's up about 14% on $114 million that we did in the first half last year -- $114 million. [ I wouldn't midway ] between that number, we're up about 14%. Pretty dramatic. When you think about what's going on in the world, in terms of, as I said, Central Bank slowing down demand and the year, we're seeing demand up by 14%. So I think [indiscernible] were up 14% on revenue year-on-year, I think [indiscernible] will be pretty surprised. I'm pretty pleased. Despite all the headwinds, seen revenue increase. The result of that is we expect to see our first half revenue up at about double from the first half of last year to $10 million to $12 million impact. It's the same number that we gave out just a couple of months ago. These are dramatic increases, of course. I can show you how much that has increased in the [indiscernible] 100% in the first half that means that the business is really good going forward. I have to say that this is very stretching for the management team. This kind of increases are -- required a lot of management focus and management determination and process in order to bring them through, don't just happen. But we really are seeing the businesses now beginning to perform and continue to say [indiscernible] debt-free in FY '24. And the message there really is that we are seeing good EBITDA conversion, good conversion of revenue margin into cash flow. And of course, at the end -- as I said earlier, the numbers speak loudly. And if we can convert, we can see that amount of growth -- we can turn that growth into cash flow and we have a very strong business through this period of time. A couple of things. I'm just going to follow up from last time. This is the end of the presentation. I put the slide up last year, about a couple of product launches. We talked about partnership earlier on. [indiscernible] 150 of these truck trays now and most of what we sell these days is now converted [indiscernible] this new lighter weight [indiscernible] number of headline contracts particularly here in Australia but also in Asia as well. Things that we wouldn't have won without investment [indiscernible] has been a delighted with the outcome there. And also, the [indiscernible] buckets that we launched just over 1 year ago, 15 months ago. And when I said that our Australian business is full of buckets, a big number of them new high-performance bucket [indiscernible]. And then very quickly, before I finish, what can we expect next? Well, I think the U.S. is going to be a growth either in terms of revenue and margin in our business going forward. And that's our conversion of OEM consumers to customize product and consumers to kind of headline in terms of growth. We're going to see growth across the group. I think that big steps forward are going to be in the USA, and that's good, because they are delivered to margin products as well. AustBuy will continue to grow. And the next big target is to get AustBuy product into the United States. It's a little bit more difficult in the United States because they have tariffs on steel going in. So that makes a little bit challenging. But it's also an easy opportunity in the United States [indiscernible] steel into there. We think there's a $10 million benefit to that business. If we can replace all U.S. steel tomorrow [indiscernible], which is it's not straightforward, but we could do that, deliver a tailing benefit. So that's what we're chasing. It will depend on how we've come up with good ideas to make that work. We've also turned it to a bit of a logistics business, which is not something we've had to face before. We got a lot of front coming out of Indonesia now going around the world. And so the business will start to focus on logistics, lots of opportunities [indiscernible]. So we'll talk about that a little bit more in the future. Australia's rapid expansion into the mining bucket area. I think it will be a feature of what we will talk about over the next 12 months. And also, as I alluded to, the continued expansion of the manufacturing hub in Batam. And I contribute whatever we have done so far in Batam. Our determination is to go so much further than we have seen already. And our aspirations for that business are much greater than what we've achieved -- really what we've achieved already is quite dramatic. And I think, again, it's a big part of what we've talked about over the next 12 months or so. So it's a bit more of the same. Why is it more of the same? Because I think the strategy is right. I think it's playing out well in the business. We just need to keep it going, only to do a lot of new stuff. We just need to do what we're doing, do it more broadly, do it more effectively. And there's a lot of benefit for us to get out of those growth strategies. And that's it. I think there's a Q&A at the end.

Thank you, David. This now brings us to the formal part of the meeting and the items of business have been considered this meeting have been listed in the notice of meeting. The notice of meeting has been made available to shareholders on the 8th of September 2023, and I'll take it as read. Before we consider the items of business, there are a number of procedural matters I wish to draw your attention to. In the interest of transparency, I intend to call a poll on all meeting resolutions. I will discuss each resolution in turn and then conduct a poll after the last resolution. Each resolution and property count for each resolution will be a slide on the screen when that resolution is being considered. I am holding undirected proxies in my capacity as Chair. And it's my intention to vote all proxies in favor of all resolutions. Any directed proxies that are not voted at the time of meeting will automatically default to me as Chair of the meeting, and I'm required to vote those proxies as directed. [indiscernible] Computershare, has agreed to act as returning officer. At the completion of the poll, Computershare staff will collect your voting cards and tally up the votes. The persons entitled to vote on the poll are all shareholders, representatives and attorneys of shareholders and proxy holders who hold green admission cards. On a reverse of your admission card is your voting paper and instructions. Yellow admission cards have been issued to nonvoting shareholders, who are entitled to speak at the meeting, but are not entitled to vote on the poll. White admission cards have been issued to visitors, who are not entitled to speak at the meeting or vote on the poll. If there's any person present, who believes are entitled to vote but has not registered today, please raise your hand and representatives from Computershare will assist you now. I shall now proceed with the business in the order as it is listed in the notice of meeting. Questions on any item that may be raised into consideration of that item. Please state your name and ask your question. The first item of business deals with the financial statements and reports. These have been released publicly and forwarded to the shareholders, who requested them and are now laid before the meeting. These financial statements and reports are for the financial year ended 30th of June 2023. This is not a resolution and no vote is required on it. On that note, I now invite questions or comments from the shareholders in relation to the financial statements and reports and will generally have the management of the company. As I advised, representatives from the company's auditors are in attendance to answer any questions shareholders may ask may wish to direct to them in relation to the conduct of the audit or in relation to the preparation of the financial statements. Are there any questions? Okay. As there are no questions, we'll move on to the second item of business. The next item of business asks shareholders to adopt the company's remuneration report for the year ended 30th of June 2023. The remuneration report is included on Pages 33 to 41 of the annual report that has been made available to shareholders. Unless there is an objection, I will take the motion as being read and refer you to the screen for details of the proxies received for this resolution. Whilst this is a nonbinding advisory vote of shareholders, the views and comments of shareholders certainly be taken into account by directors when further considering remuneration matters. I note that voting exclusion applies to this resolution as set out in the notice of motion. The Board recommends that all shareholders vote in favor of this resolution. As I mentioned earlier, voting on this resolution will be way of poll and conducted after last resolution. Are there any questions on the remuneration report? No? I will now move to the resolution #2. This next item of business is a resolution of Sybrandt van Dyk. Details of Sybrandt 's qualifications, experience are set out in the Notice of Meeting and the company's 2023 annual report. Sybrandt has been a Non-Executive Director of the company since February 2018. Unless there is an exception, I will take the motion as read and refer you to the screen for the details of proxies received for this resolution. The Board recommends that all shareholders vote in favor of this resolution. Voting on this resolution will be the way of poll. Are there any questions on this resolution? [indiscernible] This resolution is last to the item on the agenda. So with that, no question, we will now conduct a poll on the resolutions. Please complete your voting cards and ensure that you print your name and sign where indicated. When you have finished, please lodge it in the ballot box being circulated by Computershare. Please let returning officer or any Computershare representatives present know if anyone has any queries or require assistance to complete their voting cards. [Voting]

Okay. It appears that the voting process has been completed. If there's any individual present, who has not yet had their completed voting card collected from the Computershare staff, which please raise your hand. I'll now declare the poll closed. As mentioned earlier, the results of the poll will be available shortly and will be announced on the ASX and on the company's website. A recording of the website will also be also available on the Austin's website following the AGM. Thank you, all your attendance, at this meeting and your interest in the company. On behalf of the Board, we look forward to your continued support. I now declare the meeting closed, but we now have time for questions.

And I'll go to the floor first off. Anyone from the floor would like to ask questions? No? All right. I've got 1 here.

Last year, you said that you would consider paying dividends. You had a pretty good year [indiscernible] benefit from being a loyal shareholder.