DXN Limited (DXN.AX) Earnings Call Transcript & Summary

Good morning and welcome to DXN Limited's Q1 FY '26 Webinar. This morning, we have CEO and MD, Shalini Lagrutta; and CFO, Laila Green, presenting. [Operator Instructions] I'll now pass to Shalini.

Thank you, Mel. Good morning, everybody. Welcome to the Q1 FY '26 presentation for DXN. Thanks, Mel. When we started the business several years ago, we had the Modular Division and the Data Centre Operations. This sort of gives you a perspective in terms of revenue where DXN sits with the new business that we've introduced to the market, the Data Centre as a Service or the DCaaS business. So we -- because of our vertically integrated nature of being a manufacturer, operator of modular data centers and our skill sets across the board is around designing, engineering, manufacturing, deploying, operating as well, DXN is in a good location, a good place to deploy capital-light facility as a service models. And this is to sort of remind investors where our revenues are coming in now going into FY '26. But FY '25, if you look at our results, 85% of our revenue was Modular Division, Data Centre was about 12%, Data Centre Ops was 12% and our DCaaS business was 3%, and we expect that component to continue growing. Next slide. This gives you a little bit more perspective around what these each business model looks like from a core offering, who our customer base would be and the business model that it covers. So the Modular Division, high-growth, custom prefabricated solutions for our customers. Typically telco, hyperscale, operators, government, global Internet companies are all natural customers for this. The business model is turnkey build and scale. Data Centre Operations is owning and operating data centers and it's based on a monthly MRR. Data Centre as a Service, DCaaS, combines both our modular ability to actually custom build for our customers and at the same time of our operations being able to own and operate data centers and maintain them on a long-term basis, also with the subscription-based revenue, or MRR. But because it's capital light and it focuses specifically on customers on the EDGE of the network, of the telco network or the Internet network, it facilitates us -- it enables us to utilize our entire ecosystem of skill sets within the company from design right to operate. And of course, across the business, across all 3 businesses, there's ongoing operations and maintenance contracts. Next slide. Thank you. So to sort of establish where we have deployed around the world, we have sort of marked where we have deployed. We're approaching our 100th modular delivery. And this is not necessarily 100 modules, it's 100 deployments, and that's going to incrementally grow over the next several years. We have -- in terms of our capacity of our existing factory in FY '25, we were close to 80% utilization in terms of utilizing the resources that we've got. And effectively, that would be a COGS as opposed to an OpEx. So the utilization is high. Safety records are high. And our facility size, our own facility size in Perth at the moment is 4,200 square meters. In FY '26, we're starting to use and utilize partner factories for us to scale. However, having our own facility in-house assists us -- it enables us to get into -- and demonstrate the ecosystem from the beginning to the end. But as we scale, that should grow. In terms of where it is that we've deployed, if you look at that map, a lot of our deployments have been in the mining sector. If you look at Western Australia, the EDGE networks, we deploy across cable landing stations. So across the Pacific, you will see quite a few deployments. There are EDGE data centers that we've deployed into Africa, on the continent of Africa as well as Asia Pacific as well. So the Asia Pacific, obviously, deployments will become much larger. And we also expect quite a few of our deployments on the Eastern Seaboard in Australia as well starting to grow. Next. So what have been the tailwinds for us in terms of DXN? What we've seen is there's been a lot more demand for distributed low latency infrastructure. What that means is essentially EDGE networks, cable landing stations, customized solutions for our end customers who need upgrades on existing data centers, that's -- a lot of that has been the industry tailwinds. We do have a huge diversified high-quality group of clients across various industries. We are always innovating and finding new solutions and new problems to solve effectively for the prefabricated modular business. That's a key tailwind. There's certainly been an adoption of modular data centers across the industry. We have definitely seen that. If you sort of look back 7, 8 years ago, most customers were very niche, but now you're starting to find -- the applications are starting to get deployed. Hyperscale data centers are looking at prefabrication. You're having global Internet companies by default going to prefabricated modular data centers for cable landing stations, et cetera. So in the past, the demand has effectively been niche when they absolutely need it. Right now, that's the go-to by default tenders across the board are demanding for prefabrication in these infrastructure builds. So then the other thing is, of course, from our point of view, because we are vertically integrated, we do have skill sets from the construction piece right to the delivery and operations. There is a unique value proposition that we can offer the market, enabling new services and new products that our competitors will struggle to offer. In terms of high-growth industries, AI, hyperscale customers, a lot of these customers are looking for highly reliable, high-quality products. So the run of the mill, a module -- a single module provider, a customer -- a manufacturer in a country that does not have the scale across multiple geographies would not be as attractive as, say, somebody who's actually able to deliver end-to-end in-house as well. So from our team from design and engineering, that is a real key value proposition for us. A lot of construction companies do not have the design and engineering and design wins with these end customers. That's a key part of why people come to us and why we have a lot of inbound sort of requests for end-to-end deployments. Next slide. We have had various sort of tweaked versions of this over the years and -- over the last -- sorry, over the last sort of multiple quarters. This is to -- and it continues to evolve on how we see the critical -- growing critical infrastructure markets in the industry. EDGE market segments that you see on the top there, that's really the business that we currently deploy. So we have cable landing stations. These are 30-kilowatt to 2-megawatt-type facilities that we currently deploy into. Mining modules are a big part of our deployments as well historically. EDGE data centers -- and EDGE data centers are interesting because they constitute today, not just low power requirements. They also require the -- we are also being asked to design and deploy higher AI, high-performance compute modules, and these are sort of anything between 50 kilowatts to 100 kilowatts per rack, and this is with the new NVIDIA Blackwell designs and high-density workloads that are going into data centers. So you're starting to find that these customers are looking for EDGE deployments. So they're still considered EDGE as opposed to hyperscale, which is the bottom segment. But it is starting to -- we're starting to look at not just low-density stuff. So in the past, it used to be sort of 6 to 10 kilowatts per rack, and that will be adequate. Everyone is planning for the future. And that's really where prefabrication comes in because these are very highly capital-intensive deployments. And so a lot of our customers are looking to mitigate that risk of huge infrastructure deployment for EDGE data centers that require high density. And so because of that, the prefabricated solution, the ability to build a small and then scale up is starting to become the go-to. And I think very -- an obvious market that we are currently deploying in already, defense and government, these are portable data centers. These are solutions that need to be popped up very quickly in remote locations whenever that's needed. The second half of the slide, the bottom half of the slide, you'll see there, these are much larger deployments that we're starting to see. And this is in demand now, prefabrications and demand for these type of applications. So you see 2 different segments there. One is hyperscale data center superstructures, and these are essentially very large deployments. So we've got a product called StructCore, which we've deployed. We've had a deal in FY '25 with Ventia. Essentially, that is upgrading an existing exchange with high-density rack solutions that we can prefabricate and deploy to site. Similarly, hyperscale customers are looking for these type of solutions. And we're talking about megawatt- to even gigawatt-type deployments, and that's a big focus for us. Mel, I think it's swapped back for some reason. Yes. So that's 5. And then the other -- the second last slide there is -- sorry, the last slide there is the last quadrant there is critical support infrastructure and so standard rooms. So PTUs, chiller rooms, these are all requirements that we're starting to see in the hyperscale market. Next slide. So again, just to sort of give investors perspective of all the different market segments that we look at and that actually has proven to us and to themselves to the industry that prefabrication suits, and these are the sort of specific markets. And we try to articulate a little bit more where the growth is, where the volumes are in each of these sort of market segments. I won't go through all of them. But yes, if investors have any questions, feel free to ask. A quick snapshot of our high-quality customers that we've got globally in all the various industries from mining to hyperscalers as well. Thank you. I will ask Laila to go through the next couple of slides relating to the quarter 1 financial results.

Thanks, Shalini. Quarter 1 was a slow quarter. We started off the year with just under $1 million worth of revenue, and that is much lower than what we were anticipating purely because it was -- 3 of our major projects were placed on extended hold, 2 from the customer's perspective and one from our perspective, purely wanting to make sure that we were getting the design right and the componentry right for the deployment. That project has since come online again. So it's reactivated in October, but it did slow down the revenue generation for Q1. We are expecting our second project to come back online in the next couple of weeks. That one is waiting on a DA approval. The customer has requested that we actually stop further manufacturing until that DA approval comes through. And the third one, we're still waiting on the customer to provide us with confirmation. Because of the projects being placed on hold, that has created a delay, not a loss in revenue. It's just rephased to later quarters within the year. And however, our cash flow balance remained at $2.4 million, and our backlog is still quite strong. We received $4 million within the quarter of cash receipts. And however, our operating cash flow was a negative $428,000, and that was purely because we had to pay suppliers from Q1 -- sorry, Q4 FY '25 without reaching our milestones for these current projects. So our cash flow has been impacted by that. Again, it's a delay, and we should anticipate them starting to come back online in Q2 as well as progressing further in Q3 and Q4. Thank you. The DCaaS update. DCaaS was approved -- the DA was approved in August. So site installation started back then. We completed and dispatched the genset in the cabinet to Darwin. And everything has been going according to schedule. We are waiting on the final confirmation of the power and the Internet were connected on Friday. That was when they were scheduled to be connected, and that actually completes our site installation for this DCaaS project, and it allows us now to start billing for the recurring service fees. So that will start in November. And also, we've reached the final completion milestone for the DCaaS project as well. Thank you, Mel. With the revenue growth, as you can see, we've only received just under $1 million in revenue for this quarter. However, our backlog is still quite healthy with just under $12 million. We're anticipating additional opportunities being secured, one announced this morning. So that will definitely become stronger and healthier as the year goes on. This is a true indication of our misalignment between cash receipts and revenue. As I said, this quarter, we received $4 million in cash receipts. However, our revenue was just under $1 million. And that is the, I guess, the nature of the projects business model. The cash flow doesn't really aligns with the revenue. And unfortunately, there is a misalignment when we receive payments to when we actually pay our suppliers as well. So this month -- or this quarter, I should say, you could actually see that there is a lower revenue as opposed to the higher cash receipts. However, there's still very much -- when you see it on an extended period rather than quarter-by-quarter, you can see that they actually do even out. Hand it back over to you, Shalini.

Thank you. So with regards to the FY '26 outlook, we are very bullish here at DXN on the growth opportunities we've got in the business. We have, as at 14th of October, 75 identified projects that we are actively working through with the team. We've had growth in salespeople and sales personnel within the team as well as presales, meaning engineering presales supporting them. And that's double essentially of what we had this time last year in terms of people going out and looking for business, hunting down and moving -- progressing deals across the pipeline. It is a combination -- the projects are a combination of various projects. So there's an increasing number of Data Centre as a Service opportunities that we've got. There is opportunities in StructCore, which is both for both EDGE applications as well as hyperscale, which I talked about, as well as satellite gateway opportunities. All of the existing growth that we -- the business as usual stuff from FY 2025, which is landing stations, satellite gateways, mining customers are all still there, but we're starting to see the fruits of our investment and labor in StructCore, hyperscale, DCaaS starting to come through as well and through the pipeline. As of today, the 75 projects are distributed across these milestones as we identify them. At DXN, we -- the management team are heavily involved pretty much from sort of proposal and RFP submission onwards. We have good visibility on all of that above sort of that mark when it comes to that stage. Final negotiations, contract wins, a lot of these things take time from a contractual point of view because we're talking about customers who are much larger with much bigger teams and a lot more boxes to tick with regards to negotiations. But we're starting to see that growing. We're starting to see the final negotiation contract win sort of contracting stage growing as well. This deck, this slide, this version of deck, includes the APTelecom contract that we've just announced this morning. So you need to take one off the last #4 there to #3 for it to be current. Next slide. So as we highlighted there with $11.9 million in backlog coming into this financial year with the secured $1.8 million with APTelecom coming from the pipeline. We're actively pursuing core segment opportunities and all the high-growth opportunities that I've articulated earlier in the presentation. We are looking at broadening our DCaaS offering to improve our revenue profile, so we don't have as much of these ups and downs, improving our recurring revenue nature of the projects. Those are high-quality customers. Typically, satellite operators who require earth stations in locations that DXN has a good solution to solve end-to-end. That would be something that we continue focusing on and growing. We have significantly expanded in the last quarter relationships with our new and existing clients in the last sort of few quarters going into FY '26 and enabling us to offer new products through constant innovation. So things like scaling the StructCore product, going into hyperscale-type customers as well, not just the EDGE applications, that will set us in good stead for this -- not just this financial year but after that as well. And that's the end of my presentation. We'll take questions if there are any coming through, Mel?

Yes. We have quite a few questions, Shalini. So maybe I'll start with the APTelecom. Nick has said, congrats on the contract win this morning. Is there potential for ongoing maintenance work to come from this contract? And just additionally, when did the APTelecom contract flow into the final negotiation verbal win phase of the pipeline?

Yes. Again, good question. So that would have been in -- I would say, it would have been middle of September. That's when it went into the negotiate stage. I know because we met a lot of the stakeholders on a trip, on a visit on an event in Singapore. So that was the point at which we knew that this was our deal to sign, and the verbal win was given. And that would have been middle towards maybe the second, third week of September, thereabouts. So I'll answer that part first. With regards to recurring revenue, yes, not just -- this one contract, we have opportunity to have more business with -- through APTelecom for their end customer requirements and deployments into the Pacific. Yes. So just for these guys, we're talking about potentially upgrading for spare parts and additional recurring revenue or maintenance contracts on a biannual basis. It's all part of the next stage of negotiation for APTelecom.

Maybe just sticking with the pipeline, we have another question saying, in the June quarterly, you had a number of projects under verbal agreement, could you explain what the pain points are in getting these signed? And what is the time frame for projects to flow from each section of the sales pipeline?

Yes. Okay. Yes, I wish there was a rule of thumb around these contract negotiations. They are very much driven by customer budgeting, getting approvals. Like Laila said, DA approvals typically are done prior to a contract being signed. Very often, you have deals that go through the pipeline fairly quickly from identified to contract win. And then it sort of sits in global win for a little while, like 6 weeks to 2 months because they're finalizing all the things they didn't really think about internally. From our perspective, they're all fairly straightforward. If we have a customer that we've targeted, they've got -- they're a great customer. They've got great credit. They are a hyperscaler global insight company. They've got all the markings of future growth. They are a good customer to chase down, and we focus our efforts on them. So we're quite efficient from that perspective. I would say 6 months would be a typical from start to the end, but very often, the final negotiations tend to drag on 6 weeks, 2 months.

Okay. So regarding the APTelecom, could you explain the cash -- Laila, maybe this one for you. Could you explain the cash payment terms of a normal project? For example, if we look at APTelecom, what will be the total IRR of the deal on a cash flow basis?

Our normal cash flow is anywhere between 30% to 50% upfront on signing. So we'll raise the invoice upon signing or receipt of PO. And then depending on the particular milestones that are agreed upon, it's, for example, another 20% on -- ready for paint -- or FAT and ready to ship and so on. And usually, it is 10% that is remaining on shipment or arrival at site or port. So by the time that the module is ready to ship, we are at least 90% received.

I guess James [indiscernible] has asked on the contract win this morning, great to see in the higher-margin cable landing space. And how do you see this segment contributing over the next 3 years in terms of percent of total revenue? Is it going to be a large runway for growth of low base in that segment? Shalini.

Yes, sorry, this is cable landing stations. Is that the question?

Yes, correct. Yes.

Yes. So there is growth in this segment. So the volumes, obviously, are not as high as, say, the hyperscale industry, but the growth is significant and accelerating in that space. As you know, there's a lot of new cables being announced all the time. All the global Internet companies are getting into building their own subsea cables. Google, Meta, they've all announced this across the industry. And that has really changed in the last few years compared to, I suppose, the last sort of 50 years that people have been building landing cables, undersea cables. The growth is underpinned by investment by the global Internet companies who are looking at having the networks ready for AI effectively. That's where really the growth is coming from.

And just if we stick to the pipeline here, can you talk to the waiting times in tender processing across the various verticals and where time lines have blown out? Or are you seeing delays in outstanding tenders in terms of contracts being awarded? Has there been any changes in this compared to last year?

So Mel, if you go back to the market segment slide, I think a few slides ago, there was a market segment slide that talks about all the different -- there's landing stations. There's mining modules. Yes, this one. So if you look at typically CLSs, we would know that there is an opportunity 1 or 2 years in advance because the ready for service for a cable company that is going out and creating the demand, deploying resources, identifying who's their cable builder, we would know this and it's public information. You can go to TeleGeography and look at all the new cables that are coming on. So it's submarine network cable maps. And that's a live net free resource that people can use to understand where the cables are coming in from and how quickly that growth is coming in. So with that, we know in advance, 2 to 3 years in advance that there is something happening. Typically, CLS, the landing station opportunities that we have are -- they would get into an RFP 6 months, maybe 8 months before they need it. And that's the process that they would need to have. We would have already specced this maybe a year or 1.5 years before because they would ask us rough budgetary numbers, dollar per kilowatt space, transport, et cetera, et cetera. So we know what's there. So in years in advance, they would already be talking to us. But the actual formal process when it gets into proposal RFP final negotiation, that will be 6 months to 8 months typically. That's when it actually goes into the pipeline. We might have interested leads in the pipeline that is not in the pipeline. But when it's actually a goal, that's when it goes into identified, qualified and proposal RFP. So that's landing station. Mining modules are very similar as well. We may not have as much early input unlike the landing station and satellite landing stations, but mining modules, we do get some opportunities years in advance, but it becomes -- it moves through the pipeline in a similar fashion 6 months. Now the others are variable. So NeoCloud operators, for example, 1- to 2-megawatt type AI modules. It's a new market. It's a new industry. We want to watch what happens. A lot of these NeoCloud operators need everything yesterday, and they need infrastructure yesterday. But you want to make sure that you go into deals with customers who have good credit rating, good creditworthiness. Because there's a lot of people talking about building AI infrastructure without an end customer, which is from our perspective, unless they're paying 100% upfront is not going to be a natural customer for us. So at the moment, what we see with this market is everything is urgent, urgent, urgent. But with regards to the colo, if they're going to colo operators, they plan. The process is maybe 12 months, 18 months, so we would know in advance. But yes, RFPs, how it actually goes into the pipeline from start to finish, that's 6 to 8 months even for this segment. I'll just jump to hyperscale. That is, again, a massive opportunity for us moving forward as we scale. These are hyperscalers and global Internet companies who are looking for superstructures. DXN can build our StructCore product. These are high-growth, high-volume customers. These would be sporadic. So if someone has a 100-megawatt requirement and they need superstructures, it could very well be something that needs to be done in, say, 8 months. That would be the quickest it would go through. Some would plan years in advance. So we would like to be in that position where we are speccing this way in advance, and we are putting it -- putting our specs into their requirement 1, 1.5 years in advance of needing RFS, ready for service, essentially.

We just had a few questions on DCaaS. So I might just skip to Slide 11. And I'll start with the first question that says, why is there a 12-month gap between delivering the project and revenue starting in November '26?

Typo. It's meant to be November '25.

Got it. And then if we go -- just continuing with DCaaS there, Laila, can you please clarify the cash flow and revenue model? Did the customer pay for the module design and production upfront and DXN module division booked that revenue and earn a margin while the DCaaS booked the ongoing recurring revenue after deployment? Or does DXN cover the upfront cost entirely through the recurring revenue in DCaaS segment and cover -- I think you covered that, but maybe just clarify.

The customers actually covers the setup fee of the DCaaS model upfront. So the cash -- the project from beginning to end is cash flow positive.

Yes. Just -- and it's quite normal in the data center industry to do that. Even when you're establishing a new data center, even if it's a large deployment, very often, there is what you call a setup fee. And that sets the construction company or the data center operator, in this instance, we're both, up for success to have positive cash flow from the very beginning. This is quite normal in any large-scale data center deployment. You've always got a setup fee that then after that, the recurring revenue part hits.

Actually, you did mention the expansion of the sales team. And we just had a question, are there any further plans to expand? And what drives the thinking of expanding the sales team? Is it revenue growth?

Yes. So it's -- right now, the focus in expanding the sales team is actually to deepen our coverage to specific market segments. So one of the team members who recently joined about a month ago, he comes from the LEO and satellite background. And while myself and a few others in the company have deep personal relationships over decades with, say, the landing station, CLS subsea industry and global Internet company relationships, we have nearly none with the satellite industry in-house. And that's the add-on. And they're solving very similar problems. They all need infrastructure. They need more need DCaaS-type solutions than they do infrastructure today. So that's the sort of thinking when we go out and look for people. So it is not where they are based or what -- it's not so much -- yes, location and geography is not relevant. It's more related to what market segment and what industry are they going to open up for us that solves the problems that we know that we can solve for customers, if that makes sense.

Yes. Maybe if we just go back to DCaaS quickly. We had a question that said in our announcement in April, we stated that DXN has entered its first DCaaS agreement with a total contract value of $3.6 million over 5 years. Could we please provide shareholders with further clarity on whether this deal represents a one-off project or if you expect it to be the entry point for a broader U.S. market footprint? And I guess the key milestone revenue/recurrence timing that investors should watch in the next 12 to 18 months in relation to that DCaaS contract?

Yes, sure. So DCaaS contracts in the satellite industry, so that's one market segment that we are starting to see traction, that is highly specific to U.S. operators. So U.S. operators who are scaling out into the global market, Australia included, Asia Pacific included. So yes, so the existing customer that we've got have opportunities for us. And outside of the U.S., the model that they have with us is ideal for them, where we own and operate, we -- they are our end customer. We have a recurring business with them that we then roll over to the next sort of term once it gets to -- so you have got ongoing extension, you constantly upgrade the capital investment that's required for that particular site. But likewise, it makes sense for them to partner companies like us who can do this end-to-end. So we do everything from the build, design, customize their prefabricated module that goes to site, acquire the site, maintain it. It's a dark site. So there's no operating people on the ground. So we are remotely monitoring. They provide us a fee for that. Likewise, there are the democratization of the LEO, which is the Low Earth Orbit technology enables us to target those -- that market segment globally. So I wouldn't restrict it to operating in the U.S. because in the U.S., they will have their own set of DXNs. But outside of the U.S., these U.S. companies who are looking at Low Earth Orbit and the other company, they all come from the U.S., most of them come from the U.S. are natural customers for us, for deployments globally. So Asia Pacific is really where we can play. So the Pacific, where we've got relationships, we've got opportunities. Australia, it's a big market. There is lots of end clients that require LEO-operated services, including government, defense, et cetera. So we're a natural fit for companies like them.

And you touched on this in the presentation, but we've been asked what makes DXN's modular data center and infrastructure solutions stand out compared to competitors, especially for defense and international contracts?

Look, I think the main thing is that most prefabricated builders today, they do not do deployments in remote places as much as we have. So that's the key difference. So when we think about like the EMCS project we delivered last year for infrastructure projects in locations that sometimes do not have even a port to land, equipment to build, so we are shipping that as part of the project. You're barging entire modular data centers. So a lot of these new sort of market segment opportunities that enable us to export. We've already solved those problems with our experience. So typically, if you look at the construction companies that build data center, hyperscale data center or EDGE data centers, a lot of them deploy on site. So they have -- they need to have people. They need to have electricians on site. There's the last bit of electricals that need to be turned on. That is a very different model to DXN because we do everything as much as we can prefabricate. Now the hyperscale data center business, when we talk about like the StructCore, again, that's why that we are attractive because you're starting to find that hyperscalers, the amount of number of people required to work on site is unbelievable. So you're talking about hundreds of electricians working the power systems, battery systems, all one on top of each other. So customers, so global in tech companies, hyperscalers are looking at this and going, this is not sustainable. The scale at which we need to build is so huge. And we've got multiple sites, multiple locations, how do we do this better? And hence, the whole StructCore idea was born 1.5 years ago when we -- sorry, 1 year ago when we talked about in the last capital raise, we wanted to develop this solution that enables these customers to build. So that is where we're deferring. We build a lot of everything that we can off-site, and that's starting to be attractive to a lot of the -- not just the -- not just these EDGE data center companies or the CLSs, but the hyperscalers as well.

Okay. We've got a few more questions on the pipeline. And just noting if we don't get to everyone's questions, we'll try and e-mail you. But could you just tell us what is the average value of contracts between final negotiations and verbal contracting?

So again, it depends on the market segment. So you might have 1 or 2 that's outside of the norm. And by and large, we are -- if you look at our existing pipeline that we came in from FY '25 to '26, we are looking at sort of that same sort of $2 million to $3 million type number. Some of them are outside of that range. But by and large, that's sort of -- that would be the principle of it. Yes.

And then could you like give us a rough idea about how much of your current pipeline is expected to translate into revenue over the next 12 months, just to give shareholders a sense of scale?

Yes. We hope -- well, we hope to hit quite a substantial amount of that. It's not practical maybe to take all of it, I would say. But Laila, I think that's something that we're monitoring very closely now going into Q2 on a regular basis. And we want to obviously maximize as much as we can going into FY '26.

And just continuing on from that, do you feel like there's a significant increase in the tendering rate with the increase in your sales team? What was the percentage increase? What has the percentage increase been? And what percentage change in win rate has there been, I guess, since you put the sales team in?

Yes. So we've had several sort of creeps into additional. So we had a CRO come in formally officially on the middle of the year, so end of July, but he was working on sort of probation before that. So he has coming in and provided the leadership side of things. So that has increased the processes and being able to manage the processes previously, which I was running myself as the Head of Sales. So that's significantly standardized our processes and discipline around key individual outcomes with salespeople working through the pipeline, et cetera. Now we've had -- after that, we've had an addition to the team, I think it was last month, so about 5 weeks ago, and that's in the LEO satellite space. So yes, there is quite a significant increase in that space since -- in the past 4, 5 weeks in terms of identifying new opportunities. So I think I'll be able to give what sort of percentage probably in the next quarter of activity it has increased. But it has increased because you've got different people who are in different focus on different market segments now coming in and increasing that activity in that market segment. Besides that, we've also got a new person who's just started literally 2 weeks ago in Asia Pacific. Been talking to identifying that person for nearly a year now. But that is going to also enable us to just execute on all the activities that we have developed through the pipeline for our Asia Pacific opportunity, but having somebody on the ground is going to accelerate that. So I'll be able to give a better -- I'll have a better gauge probably by end of the year. How substantially that's -- but I expect -- my expectation is that it should substantially increase activity and process for pipeline movement.

Okay. Maybe just one last question on the pipeline, and we might move to a couple of financial questions to finish off. So a shareholder has said positive news on the pipeline. How many previous jobs are being executed this current quarter and next quarter? I mean we talked to the 3 that were delayed. But then if required, do you have an overdraw facility for working capital from our iPartners?

Laila, I'll let you answer that.

We don't have an overdrawn facility with iPartners or with another provider at this stage. At this stage, the cash flow is showing that we can operate and remain solvent, of course, in -- with the projects currently projecting.

Well, maybe we'll just skip to the appendix. We just had a few questions on the income statement and margins between FY '24 and FY '25. So you might just want to talk to the resourcing there. So we've just been asked what can you say that drove the reduced margin? And are there one-off impacts? Or is this a more realistic margin going forward?

It is -- FY '25 is a more realistic margin going forward. FY '24 was affected by the Flow contract, which had an inflated margin. There were no costs associated with the revenue that was coming in from Flow, hence the inflated overall margin. But the FY '25 is the more realistic ongoing margin that we'll be seeing.

Okay. And someone has said, on one of the 3 delayed projects, why did the client require another DA? What does that stand for? And is there any further approval at this stage?

The DA is a development application. I believe Shalini mentioned it earlier. Usually, the customers have their development applications approved prior to finalizing the contracts. So it is unusual. And it is something that the customer requires for the overall project, not just for our component.

So basically, it's like requiring the approvals for the equipment to go in. And so it's just council approval and things like that. So those are things that delay the DA if you needed to go through a change, for instance, of an upgrade. Typically, that's done prior. But yes, this customer -- this particular customer has signed a contract with us. We've commenced the process. And yes, they are expecting -- look, we are expecting other sites from them as well. So absolutely. I think the team is now focused on how do we maximize revenue for this -- for what we've got in backlog. So there's discussions ongoing on how we can unlock that.

And Laila, we just had a question asking us how we plan to repay the $5 million loan facility that is due in November '26? And will you have to access capital markets?

No, we would be looking at refinancing that if we aren't in a position to repay the loan. But definitely, we -- at this stage, we're looking at a possible refinancing as interest rates are coming down as well, looking at more favorable terms.

Yes. Bearing in mind that previously, FY '24 -- FY '25 results makes it easier for us to get better terms.

And maybe even with a bigger lender, would you say, Shalini?

Yes, definitely.

Okay. And I might just finish on one last question from Monty. Are there structural projects in the pipeline from various end customers rather than, say, just Ventia who we signed one with already?

Yes. Yes. The answer is yes. Yes. There is -- there's quite a few, yes.

Great. Okay. We might leave it there. If anyone has any further questions, feel free to e-mail me. My e-mail details are at the bottom of the release. Shalini, I'll pass to you for final comments.

Thank you, everybody, for dialing in. Much appreciated. I understand some frustration around revenue numbers. The nature of our business is such that you look at that chart, cash and revenue eventually catches up. I think from my perspective and our team, we're all very bullish here. And we think that FY '26 is going to be great, so it's FY '27 and beyond. Thank you for dialing in and let us know if you've got any questions.