Energy One Limited (EOL.AX) Earnings Call Transcript & Summary

Good morning, everybody. If you can hear me, can someone just say yes?

Yes. We can hear you, Shaun.

Thank you. So just formalities, if I may. We will be recording the meeting, and that's about to start now. So if you have any questions, you can either e-mail them or put them in the chat or indeed present them at the end, if you may -- if you would. So I'll ask [Indiscernible] to start recording.

Done. Thanks, Shaun.

Thank you. Good morning, everybody, and welcome to the Energy One Limited half year results presentation for the half ended 31st of December 2023. My name is Shaun Ankers, I'm the Group CEO. I'm joined today by Andrew Bonwick, our Chairman; and Guy Steel, who is our CFO. We'll be going through some slides, explaining the results, and then you're welcome to ask questions, as I said before, either by e-mail or the chat or indeed please put your -- raise your hand in the in the meeting. Well, great. Thank you very much. Obviously, there's a disclaimer there, and I'll move on to the first slide. And I'll ask you please to go on mute. Okay. News and highlights. As you will know about the company, where our vision is to be the world's leading supplier of software and services to the wholesale energy industry. That's what we're moving towards. The world is an exciting place moving towards net zero, and we intend to be absolutely at the forefront of that, and we are working towards that, and I think we're doing a great job in the process. A testament to our strategy over recent years is showing through right now. You can see the revenue growth up 22% on the prior comparative period being 12 months ago at 31st of December '22. Recurring revenue, which we focus on strongly, another great result, up 23%; and ARR, which is a forward-looking measure for recurring revenue, up 23% as well with a little bit of tailwind from the FX, which does move around from half to half. But again, 20% to 23% up on the prior year. That's 2 really good strong periods of organic growth. I want to point that out is a completely organic growth. We haven't had any acquisition activity for a while now. And our recurring revenues are at 90% of the total in this half, which means that we do have less reliance on project revenue. We do welcome project revenue, but recurring revenue is the key in a business like this, and that's what we're working towards all times. So again, organic growth, great result, a testament to the strength of the company and the opportunity that we've got in front of us and the way we're addressing it. We did have some investment in the half. EBITDA is reduced 35% on a statutory basis. We invested in human resources during the half, some of which was due to market forces, but most of it is because we've started to help gear up for growth. And -- but even then the growth consistent -- in that growth -- in the expense line that is consistent with our revenue growth, which meant that margins were preserved for the last 12 months. Comparative EBITDA, I'm going to try to back out some of these genuine one-offs, which I will discuss in a bit, was $5 million. Hopefully, that gives you a better idea comparatively on the prior year. It was an eventful half, as observers of the company will know. We had a muted acquisition by STG. During the half, we had a cyber-attack. That came in sort of September last year. And we did have a modest internal restructure, and I will talk about that as well. But suffices to say, a great half and year for revenue growth. We're doing a bit of restructuring to leverage for growth and a couple of events that happen to us that resulted in genuine one-offs. I do regard the modest loss of the half to be a genuine blip. There's some 10 years now of profitable halves. We will return to profitability in the next half. So I see this very much as a blip. But happy to talk about it, and we'll dig into the detail as you wish. So I'll hand over to Guy, please, to get -- go through the numbers.

Thanks, Shaun. Just to provide a bit more detail in terms of the numbers. As Shaun did allude to, yes, the 12-month period did see the Aussie dollar weaken slightly about 6%, 7% against both the euro and the British pound, obviously, we have operations overseas. So there's a little bit of a tailwind on the revenue numbers, but conversely, also impacts the cost numbers. And overall, on the result, it doesn't affect the profitability, particularly materially. As Shaun said, we have seen what's really pleasing is we're seeing consistent growth across all of the businesses. So it's not one business having an outstanding period. It's all of the businesses contributing very strongly. And one of the things Shaun did talk about in his CEO report was CQ. And timing of broker revenue has been slightly down, but the recurring revenue, again, good growth. So from a total perspective, Shaun talked about a 22% growth. Just to break that down, Australia was at 13% [Indiscernible] contain segmented results. So the numbers are in there, but I'll do the mathematics for you. So here, we talked about a [Indiscernible] broker revenue. And Europe was actually up 39% on that [Indiscernible]. Recurring revenue up $4.2 million, 23%. So Australia was up 16%, CQ is 13%, and Europe 31%. So again, all the business is performing pretty consistently well. And just on recurring revenue, it was up 9% versus [Indiscernible] . So as Shaun said, when you look across the last 3 halves, the momentum has continued through. From an ARR perspective, we added close to $9 million of ARR, 23%. We talked about the impact of FX. So 20% constant currency. Again, Australia up 17%, CQ 13%, Europe up 30%, and again, ARR against the 30 June half or half 2, 30 June 2023, up 7%. Project revenue pleasingly outperformed where we have talked about program. We did see through timing, Australia slightly down on projects, but Europe have had a really strong half in terms of project revenue probably and largely driven by existing customers. What we said about project revenues is we expect an improvement in the second half. Just on some of the other finance points we would make. If you do look through our financial statements, you'll notice our receivables aging, driven by a little bit of timing and billing. And that's now -- our receivables are now pretty much back in order. So more a timing item than anything. We do increase our net debt, and we did mention that we renegotiated our net facility agreements. And that was really common timing of the restructuring side of costs, some of the items of that nature. And the net debt has increased. But [Indiscernible], we've also reduced our trade payables and other liabilities by a similar amount. From an operating cash perspective across the half, it's actually pretty similar outcomes. And I guess, given the underlying result, people would say how -- how was that eventuated. We did receive in the half an R&D refund or credit in the U.K., about $500,000, which has assisted. [Indiscernible] is quite different between the 2 periods. And then the restructuring costs that we booked of about $800,000 was not paid out in cash in the half. So at that point, we'll move to -- back to Shaun.

Yes. Thanks, Guy. Obviously, you'll get an opportunity to please ask detailed questions about that, if you like, at the end, we'll go through that. But just looking at our -- obviously, we talked a lot about recurring revenue. And as Guy has pointed out, rebound is strongly after sort of a flat period post COVID, it's really come back well now. It's giving us a 25% CAGR since December '21, and most of that's organic. Strong growth in Europe, as Guy alluded to, particularly strong growth in Europe, and a good solid result coming out of Australia. The point we've made for many years that Europe has a much bigger runway for growth going forward. And of course, that's why we are there. Australia is a great economy and a great market. But obviously, there's 600 million people in Europe. So we see opportunity there. And I think the numbers back that up. There's no doubt that we just continue to go from strength to strength over there. Combination of software and services gives us differentiation. I talked about it in the [4D] in some -- a little bit of detail, but our strategy over many years has been a one-stop shop for our software and services to provide people all of what they need. And that message is getting through, particularly for coming back from the market. I do appreciate that you can have one supplier for all of your needs as opposed to just trying to have one product that you're pushing and hopefully, that's the product that everyone wants. So it doesn't matter what you need. We can supply it to you. And the market, I think when we came back from E-World, some 40% of the customers had expressed interest in more than one product and service. So there's definitely a differentiator there that we're developing for the marketplace. And I think that's the key to our continued steady and stable growth Guy, please next slide.

Thanks, Shaun. Just take you through the comparative profit which we delivered, [Indiscernible] the items that are moving, the results around. So I think that comparing to the previous half, we obviously have one offs in that half. And then in this period, we had a number of one-offs around restructuring [indiscernible] STG costs. Shaun will talk about them in some detail in his CEO report, and we've got a page later where we can go to more detail if people want. We've talked about the revenue pretty significantly done on Hosting and IT costs. The hosting component is obviously hosting customers, and that's obviously going to increase with volume. And there is also customers who have their own environments effectively, we incur costs and pass that through to customers as well. And then what you'll also see is investment in IT systems. So yes, as the group has increasing complexity, we've made to invest in our systems that includes [Indiscernible], finance system, includes expense management, our sales tracking and [Indiscernible] tracking, and also our risk management, which has been a particular focus over the last 6 to 12 months as well. The other component in here is global operations, there was a slight increase across [Indiscernible]. That was mainly global operations just wasn't fully operational in half 1 2023. It took a while we ramp up and really got going in about September of that year. So it's really -- that's not indicative, just not a full year. I guess, not to be surprised, we've increased our interest payments through rate changes, obviously, being in an increasing interest, [revolving] slightly more [indiscernible], but it's really rate driven. Shaun has talked about the salary and wages. And that's an investment in existing employees. So we have seen some -- as Shaun talked about quite extensive in his CEO report, some cost pressures in the Adelaide business. We've got highly sought after staff. And also, if we replace [Indiscernible] as well, we're tending to, I guess [Indiscernible] given the greater complexity of the business, and we put significant roles into the business as well, and they're all predominantly front end. So they're certainly our back office and in our roles, they're typically business development, products -- customer-facing roles. Then when we look at the other boxes, there's a number of items in there, such as employee incentives, to start share scheme, there's capitalization of resources, facility costs and obviously recruitment costs to bring those -- the resources on board. So hopefully that gives people color in terms of how the P&L has been impacted across [Indiscernible] those items. Back to you Shaun. If you want to comment on the nonrecurring?

Yes, thanks. Obviously the slides provide a bit of clarity. We did have some genuine one-off costs during the half and some things that we chose to do as well, but we regard them as sort of nonrecurring. In the genuine one-off, obviously we had to deal with the STG arrangements, and that requires some cost for us that we do not expect to reoccur. We had the cyber incident, which we genuinely expect not to reoccur and certainly hope the same. So those are some of those genuine one-offs in the half that wouldn't necessarily see again. We have made some choice. We structure ourselves, and I've got a slide on that coming up. But again, these are -- some of these restructuring costs are one-offs or nonrecurring items that won't occur again. And in fact, we do expect to make savings on the back of that. So this is just a reconciliation. As you can see there, $1.74 million array of expenses that would not necessarily reoccur. Some of these are for accounting reasons, only taken up in the half whereas opposed to spread over the year. So again, we're not expecting them to see them in the second half either and another year. Yes. So the message there is please have a look through. Hopefully, it's nice and clear as to what we spend the money on. But again, we expect this to not reoccur in the second half. And obviously, that's a big part of that profitability swing that we [indiscernible]. So we talked a little bit in the [Indiscernible] about restructuring that we've had a modest restructuring of the business. We've grown up from specialist software businesses and services businesses that focus locally and regionally. For a while, we've run the business on a federal type of structure where we had regional CEOs who were in control or resource in that particular area. And that's served us really well. And I think especially during COVID, those shareholders who've been with us during COVID remember that we did get through COVID really well. And I think that was due to the strength of that model. People are acting locally, doing what they did well. I speak for myself when I say I couldn't travel for 2 years, to go to Europe, and we still managed to maintain really good business outcomes there. So a really strong asset to the way the business is growing up. Otherwise, we continue to grow and try and leverage into the future to be a truly global business, the shared services, the more conventional model is the one that we need to move towards and move away from a federal-type structure and more into a shared functionally oriented structure with a matrix approach with local country managers, driving sales and customer success and shared services throughout. And that's the modest restructure. We have been working towards that for a while now, but the outcome of that is that we, in the half, made the change to actually going away from -- formerly from regional leadership. And this means that both Dan and Simon, who are our regional CEOs, are now in the [process of leading] the business. They've both been absolutely purposeful in building the company up. Dan's been with us for 16-odd years, and Simon started building -- made our first foray into Europe. And between them -- have absolutely built up a reputation and success of the company. We're obviously -- as times evolve and we move to a more functional and SaaS structure, those roles are not required any longer. And we wish both of those gentleman and best wishes and our thanks, our heartfelt thanks for everything they've done for us. But again, same in the [4D], we do have a highly competent layer of senior executives who are very good at their jobs and country managers that are very good at their jobs. And we will move forward seamlessly into the new future for the company. Obviously, restructurings had its impact financially. But of course, we do expect that there will be some savings going forward, some long-term structural savings. And we're anticipating that's about $2 million per year starting next year. If we redeploy some of that capital, it would be likely into direct income-generating costs. So we're slimming overheads and moving towards any additional expense would be into income-producing direct costs. Thank you very much, and thanks for those 2 gentlemen for their efforts over the years. Next slide, please. So we produce -- this slide each time, it's SaaS-style metrics because there's some quite informative for the community. As you can see, there's fairly consistent growth throughout. Again, ARR $46.4 million for the last 12 months. So that's nice forward looking. So we've got $46.4 million on the books. LTV per customer, and you can see that growing steadily. Churn, again, always stay low. Net revenue retention, that's a relatively new measure for us. Guy can dig into what the definition of that feel like you can see that continues to grow. LTV to CAC, we have invested a little bit in more marketing and sales now as we are focusing more on the customers who don't know us, if you like, the customers aren't aware of as the market changes and becomes more fragmented, it's important to reach out to customers who might not know the name. And so that's what -- we're spending a bit more money on there. Gross margin, I will talk about that. We preserve the margins for the year. I think, obviously, everyone is looking for operational leverage in a business like this. And I think that's something that we do expect to go forward and certainly some of those changes that we will see more of, but in the footnote, they can look at some of the evidence that is happening in terms of localized GM for the Aussie and the European business. But obviously, as revenues grow, we do expect margins to grow with them, and that's what we're setting up -- increasingly setting up to do. Next slide please, Guy. So relatively straightforward and concise presentation for you this time, but I do want to summarize for you. Again, we're very pleased with the revenue growth. We really feel this demonstrates the strength of the model and of the opportunity and of the quality of our teams that we have with some great people and great services and great products. And that's showing through in the revenue, particularly organic -- organically. I mean, for many -- not many years, but some years, we had some mixture of organic and inorganic, and it was perhaps difficult for shareholders to determine where the true organic line was, but we're looking at 23% in the last 12 months. On modest restructuring and investment in our people to get growth, we pointed that out. But again, mainly in the half, and we feel we're rightsized -- more or less rightsized now going forward. As I pointed out, we absolutely expect to return to profitability in the second half. This is -- as far as I'm concerned and we'll get back to it. Again, a wonderfully exciting opportunity for the company, made up of great people, some 180 people now, all knowledge workers with a great deal of experience and talent. And we continue to get the signals from the market that we're on the right track. And finally, the Board has offered revenue guidance going for the full year of $51 million, of which $45 million will be recurring. And we can take a question on that if you'd like. But again, great company, very pleased and excited about the opportunity. I hope you are, too. And we just continue to move forward and go from strength to strength. Thank you very much. We have some questions there.

Okay. There are a number of questions, some questions from people on the call. So first question is from Claude. Has the company geared up for growth in anticipation of contract wins that are uncertain? If growth tends to be a bit slower than expected, could that cause a problem for the company?

We're always -- it's a compound question, Claude, but -- so hopefully, I'll give a straightforward answer. There's always uncertainty, but the signals we're getting are that -- and the evidence that we're showing is the revenue growth is set. And you need to be a little bit ahead of the game. You need to over hire and get over resourced. But we're never that far from the fine line. We're not -- we don't grossly do one thing one way or the other. So we do expect the revenue growth, and we geared up for it. Now of course, we'll just tweak and adjust as we go, as we've always done. And so I am very optimistic about the future of the company, and we put our money where our mouth is to a certain extent by making sure we have the teams rightsized. It's not reliant like it used to be on [Indiscernible] once or twice a year. So that's changed as well. And a lot of this stuff is recurring revenue growth now. Hopefully, that answers the question.

Another aspect of that, Claude, is that the increase in cost is in line with our revenue growth over the period. So that can be tuned. But also -- and to go to a question that Andrew Tan posted later on, management structure is an overhead, and it always has to be assessed as value for money. And the federal structure serves us really, really well when we are basically operating as an Australian region and a European region. And we are now increasingly operating much more as a global organization. And so that's where the restructure came from was to tune the management structure and the cost of management to the way the organization is functioning. And in that respect, Claude, the restructuring has taken out overheads. So improve the alignment of the company towards the market. So if things change, yes, we can tweak in the future as well. But I think basically, the changes are in line with the way the company is seeing in the market at the moment for sure.

Next question is from [Indiscernible]. How do we look at the level of OpEx going forward? Is the ongoing cost base now largely in place after the organizational restructure? Or will there be further increases in OpEx in the second half of 2024? Can we expect that in FY 2025, the level of OpEx increase is more business as usual-like in line with [indiscernible] 5% to 7%?

Look, we're not getting into percentages, Andrew. We do expect more business-as-usual-type growth going forward. Of course, we are responsive to our market. And if the opportunities arise and the needs are there, we will -- like, reserve the right to actually upskill some more. But yes, to answer generally speaking, business-as-usual is what we're getting back to. We've done some rightsizing. We held on to some talented people and recruited some more. And so apart from some investment in cyber going forward, we will -- the business is in good shape to move forward now.

Thank you. Next question, probably a bit of a similar theme from Shaun. Could you add more detail on [Indiscernible] expenses from a go-forward view? Are there any expense pressure we should expect to continue for [indiscernible] and industry? So probably the expense pressure issue is a differentiator to this question.

I think we're going to keep investing in cyber. I think you can't -- these days, you can't invest enough in cyber. That's probably a notable item. And that will become clear as we get into the end of the year, and we'll obviously share what we can going forward with that. But I think in terms of the business itself, the -- as I alluded to earlier, we expect the margins to increase, which suggest that we feel that the business is in the right size. And so without, again, trying to do specifics because we reserve the right to respond to the market as we find it -- it's definitely a business as usual with expected margin growth now that we're fully into the organic phase of our growth pattern.

Okay. Next question is from Ryan. What's the ideal steady state level of debt? How long do you expect -- we're going to expect to reach that level? Probably if you ask a question, the CFO will -- get a different answer, but I might pass it, I want to -- across to you, Andrew, if you don't mind.

Look, we're very comfortable with where the level of debt is at the moment, which is repeating the comment we made 6 months ago. Capital structure is a balance between cost of debt, cost of equity and working capital needs. And in a period where there's no acquisitions, we think we're very well placed. Most importantly, the company is cash positive. So we don't have the pressures on our capital structure that other growing organizations might have. So we're -- I'm personally and the Board is very comfortable with where we are at the moment.

Yes. And I think one comment I'll make is, obviously, during the half, we increased our limit with debt, so increasing liquidity, and that was more just to provide upper end with the day-to-day with [indiscernible] business we didn't expect to utilize them and we haven't. But as I said, it's more against -- just the target levels of liquidity we like to see.

Our next question is from Andrew Tan again. What wasn't working with the region CEO structure? Is the restructuring more about structural cost savings or more about having a structure that can drive increased sales growth?

I don't contend that it wasn't working. It worked brilliantly. And the company evolves -- I think safe to say. It's time to move to a different structure that facilitates our global ambitions. So the strength -- every -- all the strengths [Indiscernible] structure remain those strengths. And if you wish to leverage growth going forward, shared services models are absolutely conventional way of doing it and other software companies and services companies do the same thing. And so we're really moving and evolving towards that. We -- the stream of shared services and the economies of scope and scale related to your resources. We can't share all resources, but there are -- greater resources can be shared. A good example of that might be in IT and operations, technical type of space, but a number of people can service more than one business. If you think about it, to plagiarize someone else's comment, you've got 2 restaurants, but you've got one kitchen. So the idea is that you can service more than one business and the results aren't constrained to a certain area. And that's a very conventional way of thinking about it. We haven't done anything untoward here. This is an evolution. I'm incredibly proud of the federal structure and where it got us, and we're just simply gearing up to the next stage of our evolution.

And the executive management will still be focused, balanced between Europe and Australia.

Yes, I make the point. Thank you. I will make the point on the [Indiscernible] that we are relocating some C-level personnel to Europe or roles to Europe. I think Europe in this report is at 55% of revenue now. So obviously, more than a half share in the revenue for the company. So trying to make sure that we've got plenty of support for that business in terms of senior roles. And so everyone understands that and everyone's comfortable with it. And I think it's just a natural evolution.

Okay. Next question. Sorry -- you'll like this question. Recurring revenue of $45 million -- kind of your guidance for FY 2024 is your growth in second half '24. Is there slowing growth overall to forecast that recurring revenue growth in the second half?

I'll answer that. We -- obviously, when we do these things, revenue guidance is regards to any descriptions, obviously, a difficult thing to do because you're asking to look forward into the future and in order to help evolve the market. So we do work out what we think it's going to be, exactly like anyone else would do. And then we have obviously trying to be a little bit conservative about what we put forward. So I wouldn't read anything into it other than what it says.

Fair answer, I think. Topic of [indiscernible]. Andrew Tan, again, something that you covered in your CEO report, Shaun, [Indiscernible] they will go? Any color on the sales pipeline? Historical [Indiscernible] project work is a lead indicator of ARR growth. Is this [indiscernible] relevant [indiscernible] the global services offering?

I think it is less relevant. I think that's a good question, but that is somewhat less relevant. It's relevant in the areas for which, for example, which is now not the greatest part of the business. I thought [Indiscernible] was fantastic. It's unbelievable how [Indiscernible] over there. [indiscernible] trade shows in Australasia as well. And we have a lot of response there, and they're going really well. We had one just a couple of weeks ago for batteries, and we attended, and that was fiercely popular and a lot of people are interested in that. But since the question is about E-World, yes, a lot of people at E-World were fully booked for demos, lots and lots of [Indiscernible] as I said, the differentiator over there seems to be emerging that you guys are a one-stop shop, and we get a lot of people, a lot of traffic coming through in that area. We've got products and services for needs and a lot of cross-selling type going on. It's very exciting to be there, as I say, flat out fully booked, [Indiscernible]. That was great. And just very energizing to see everyone. But again, not isolated just to Europe. We have a lot of interest in our services, what I've seen with teams been handling with a plan. And so we keep moving forward. So I'm very optimistic and I've got a very [strong feet] from being on your feet for 16 hours a day for 2, 3 days. It's an incredibly rewarding experience.

And you can get more information from -- I've just got some photos of the sand and what it looked like. It was [indiscernible] center is an information center around out of Europe. We also had some material recently, which had quite a bit of content on Energy One.

Next question is from Matt. Can you walk through the main points that result in the STG acquisition of proceeding? Are any changes being made to address areas of improving [Indiscernible] due diligence? Second part or -- cracking into 2 questions. Let's answer that one first and we'll do the second part of the question, next. Those are quite different topics.

Yes. So from the Board's point of view, we needed to have confidence before we spent a significant amount of money on a same booklet and all the legal processes associated with that, that the bid that we saw from STG would turn into a bid at the end of the process. And the way that the process turned out, we lost confidence in the way that STG would continue to be for the company. And it just got to the point where it wasn't a bit of sufficient robustness for us to put to shareholders. So we've proceeded accordingly. On the second item, Shaun has talked quite a bit about that, the opportunities that it gives us for improvement. And we've taken the input that we got and the questions that we got and the processes that we saw and have used those to improve a number of aspects of the company.

[indiscernible], something to say, if I may. I mean, bear in mind, you're dealing with these guys who are -- that's what they do right? They come in and they look at companies and try and pick them apart and find out what works and what doesn't. So obviously, you're having the mirror held up. You have to explain yourself as to why you do things in certain ways. And I'm pleased to say that we emerged from that with them thinking that we're a great business. And then we're talking about an objective outside. And -- but surely, they've spotted a few things that we can do better, and we've taken it onboard. So these processes aren't entirely without merit or are not useful. They are useful. And it's good to hear that you're on the right track. It's good to you that you can do a few things better, and here they are, and we're certainly pursuing them anyway. So in a sense painful as it was, it's been worthwhile in the long run.

Good. Second part of the question, net revenue retention was 114%. Was this increase in ARR largely driven by price increases, maybe price increases? Maybe I can provide some context there. I mean, I guess, yes, when you look at the calculation, it's -- so you're right, ARR plus upsell, minus down sell, minus attrition, if you think about it on that base, with attrition of 3%, say, [7%, 8%] growth in your existing customer base to get to the -- up 14%; and then 6 -- the remainder 6 -- the average price increase was around 6% to 7%. So on that basis, you would say predominantly, yes, price increase is an important factor, but not [they're the only factor]. That's how I'll answer the question. Next question is, can you provide the podcast? And I assume that's the link to the LinkedIn page.

Yes. I'm sure that's going to pop up in our LinkedIn page pretty soon. Make sure it does.

And that is the -- those are the questions that I can see in the chat so far. Daniel, I want to just put a question in. Can you talk about CQ? What was the revenue [Indiscernible]? I guess let's isolate that. Component of the recurring revenue was pretty reasonable. It's more obviously the project broker revenue, which Shaun is going to talk a bit about.

Yes, I covered it extensively in the [4D] report. Obviously, CQ is a highly professional business. It's operator broker, complicated risk transfer products. In the last year or so, the [indiscernible] highest energy market disruption, including certain of the Australian energy market completely electricity market, there's a lot of disruption in the marketplace. And so -- and [indiscernible] on the business traffic between buyers and sellers. And so there was a hiatus, if you like, in amongst that, where a few of these other buyers that you sell into these products were put through. And so we do expect that is steadily [Indiscernible] itself as they return to market. And so that had quite a big impact on us in terms of the brokerage. Nothing to do with anything to do with us in terms of the quality of the work. We still continue to be highly regarded and a leader in this area. And we just expect the market to normalize and in the coming months that to restore and also a run rate in terms of what we'd be expecting to get from that business unit. I should point out that, that side of the business is something that's got an opportunity in Europe as well, and we're exploring that. So it's not just an Aussie story. It's something that can be taken overseas. But again, financially -- financial kind of advice and brokerage is obviously a complex subject. And so to find the simple answer here. But suffice to say that there was a hiatus that's now somewhat restored.

And we did preliminary work about taking that product with that service into Europe prior to that disturbance in the market and [indiscernible] is all disappearing. So we'll just brush that off and work that out as the opportunity presents itself.

Good. Our next question is from Yohan. Should we interpret the price increases being tied to [CPI]? The answer is typically yes. Most of the business is tied around their pricing on anniversary of the contract to local [CPI], with the exception of [France], which typically go 3% to 5%, depending on the age of the contract. So I think CPI is pretty reliable way to look at it. The next question is, these energy founders not [Indiscernible]. Do you have any sense of their intention to start a similar business?

We have no indication that they'll be starting a similar business. They're all put a lot of work into for many years. My feeling is that they want to do something a bit different. So they're not certainly going to -- my feeling is they're not going to try and compete with us. Anyway, we're in great shape. One of the great strengths of this business is the moat. It's not as easy as you think to start up from this business and get going. You might think about it not with a couple of customers, but that's not the same as building a business. And it's one other reason why M&A is such a strong feature of the business, not just [Atlas], but the market is because customers are very sticky. And it's one thing to say well, I've got brand new product, it's another thing to sell more than a couple of them to your mates. It's not as easy as people think, and moat is definitely there. And whereas I wish [indiscernible] all the best wishes in the world, I don't think we'll be seeing them in our space.

Next questions from Andrew Tan again. Any update on the Shell Energy framework agreement?

Yes, that continues. We're continuing to build out functionality for Shell Australia. As I talked about at the time, our ambitions are more ambitious than that. So we have been talking to Shell, but obviously say their business needs, of course, are paramount. So we'll continue to work with them and hopefully roll out over as the years go by.

Next question is from Claude. It's quite a long one, so bear with me. Is there some way the company can have some sort of internship program at CQ Energy to try to grow the number of graduates considering a career within Energy One? And can the company target potential employees who are aligned with the vision and most likely to have job satisfaction? What strategies does the company have to try to grow the [Indiscernible] upcoming young professionals? [Indiscernible] you working for the company for raise other than salary?

That's 3 questions. We do employ graduates, fantastic because in this industry, you can sort of teach them the way that you do things, [Indiscernible] we have graduates across the business. But particularly, the question was asked at CQ. And in fact, yes, Claude, we have put on some graduates and they are fast learners and they're good to have on board. We have, as a business, generally flexed with internships, [Indiscernible] less degree of success, but we do focus on graduates. We have had a lot of success with graduates over the years. It's sort of the nature of the business. If you're a medium-sized businesses that you tend to train people up for a few years and then they might move on to some bigger company in the big city or something like that. So London or somewhere like that. So we do -- we see a bit of that, but that's just the nature of it. And we do focus on getting graduates. But we like to have a mix, right? You're going to have a mix of seniors who understand the market and come from having experience as well as graduates, which is a good place to be. It's definitely something we want to work. What's the third question?

What strategy is this company -- this company have to try to grow the pool of incoming young professionals who can rather work for the company for reasons other than just salary.

Well, first of all, I'll answer the second part of the question. First is I think a lot of people love working here, obviously it's an interesting industry. One of the reasons why they don't just disappear for money is because the work is interesting. So I want to make that one clear, Claude, it's absolutely -- why wouldn't you want to work in this industry.

And our value proposition of facilitating renewables is very important for pursing our options.

Absolutely. And so we do have an active cultural improvement program across the company and cultural support. We do try and have -- keep it exciting and keep it interesting. And especially if the question was kind of referring to young people, but as far as good candidate, the fact that we're a global business, [Indiscernible] opportunities to travel overseas, [Indiscernible] Belgian guys here in Australia at the moment, and we can return [Indiscernible] and send someone off to Europe, and that's what we're working on. [Indiscernible] wouldn't want a chance to go and -- a young person go and work in Europe for a couple of years? So we do -- it is more very interesting. And I am very proud of the people we have working in across the group. And I say, all we can do is give an opportunity to travel and do interesting things and move around and move around from products [Indiscernible] technical person or desk [indiscernible] more on the trading inside of things.

That is end of the question. Yes, those are the questions.

Okay. Thank you very much, everybody. This recording will go up on our website.

There is another question. [indiscernible] asked, is absolutely?

[indiscernible] Automation is key, and automation helps you to get that leverage as well, but not quite apart from anything else, just the fact that people are highly trained, they can work on [Indiscernible] is part of the story as well. So yes.

I think particularly on the legacy side of the business as opposed, they do gas as well.

Yes.

Okay. And so thank you for listening in. We hope you found the session interesting and informative. We welcome questions at any time. And I'd like to [indiscernible] thank you on behalf of the Board for your support of the company. So enjoy the rest of your time.

Thank you, everybody.