EPE Capital Partners Ltd (EPE.JO) Earnings Call Transcript & Summary

Good day, ladies and gentlemen, and welcome to the Ethos Capital FY '21 Results Presentation. [Operator Instructions] Please note that this call is being recorded. I'd now like to turn the conference over to Peter Hayward-Butt. Please go ahead, sir.

Thanks, Toria, and thanks very much for everyone for taking the time to listen in to the results presentation. As I think many of you, if you've had the chance to read the annual report that we sent out, I think everyone recognizes that the last 12 months has been a difficult period of time in South Africa generally, but with COVID in particular. What we'll do today is try and unpack those results for you. I think it's been a dichotomy of results from really strong bounce back in the majority of the portfolio companies, and what we'll try and do is give you an update on performance year-on-year versus what we've now turned as a market benchmark to give you some idea of how the various funds have performed, also to look at the first half versus the second half. And I think that's instructive, particularly with respect to how COVID played out during the last -- well, the first 6 months of the year and certainly, the latter 6 months of the year, was extremely different. We've also unpacked for you the difference between our listed and our unlisted portfolio. So we'll spend a bit of time focused on that. And then also trying to get to the bottom, what's the like-for-like performance that investors can look through to seeing the health of the portfolio going forward? So in the executive summary, we'll try and cover all of that. We'll talk a bit around the Ethos Capital strategy as per the Board meeting that we had last week. From a portfolio perspective, what we thought we're trying to do today is give you an overview of the general performance of the portfolio and then try and have a deep dive into the top 8 key assets, which is 84% of the net asset value, and unpack for investors what was the investment thesis or is the investment thesis that we've invested behind for each particular asset? How is the financial performance over the last 2 years have been for that asset? I think 2 years is relatively instructive. It gives an idea of pre-COVID performance and how quickly or otherwise, those companies have bounced back from the impact of COVID. And then also what new initiatives and what's the growth outlook for each of those portfolio companies? So we'll deal with that under the portfolio overview. Again, give investors an update on the liquidity analysis and then a brief slide at the end just talking about the outlook for the portfolio going forward. If I look at the headlines at a glance, starting on the top left-hand side, the NAV per share increased 6% from December where it was ZAR 8.65 as at December 2020, up to ZAR 9.19 on an aggregate basis, that's assuming that the Brait investment is incorporated at the NAV per share. If you incorporate Brait's at its current share price, the NAV per share is ZAR 6.67 over the last couple of months. That's increased by over 10% with the increase in the Brait share price and the MTN's Zakhale share price. We've seen realizations during the course of the year of ZAR 150 million, which is around about 10% of the market cap of Ethos Capital. And included within that was a partial exit of the Channel VAS stake, ZAR 75 million that we took as a partial exit on that asset, which realized a 25% IRR and a 1.6x money back on that asset. If you look at the portfolio, we'll give you much more detail during the presentation. But very pleasingly, we've seen a very strong bounce back in the majority of the portfolio. The top 5 assets, the unlisted investments, increased revenues by 14% and more pleasingly, 27% increase in EBITDA. And if you look across the whole portfolio, the attributable EBITDA increased by 59% year-on-year. There have been some significant disposals during the year in the Brait portfolio, really around Iceland Foods and DGB, which again, we can touch on later. And if you look at the current trading discounts, the NAV per share, the share price trade that is around about 55%. And on the bottom 2 boxes, what we try to show is the current valuation of the portfolio, which is currently valued at -- on an attributable basis at 7.3x LTM EBITDA. And if you do a look through based on where the market price is today, that drops to 4.7%. So that's effectively what the market is valuing the portfolio at today. What we've tried to do for investors -- we get a lot of questions around benchmarking performance. And what we try to do and how we manage it at Ethos, if you take the JSE All Share and we look at the last 6 months, the last 12 months and in the last 3 years, how has the JSE All Share performed, we exclude penny stocks from that. And if you see over the last 6 months, it's up 6%, 14% over the last year and 5% CAGR over the last 3 years. We then exclude from that international stocks, Naspers, mining and real estate, because those are investments that we as Ethos can't invest in, which reduces your portfolio, your number of companies in that portfolio down to 182, still gives you a very good benchmark. And under that, the growth over the last 6 months in that portfolio has been 15%. Over the last year, has been a very strong 32%. But over the last 3 years, obviously, has been minus 7%. And really, that talks more to an SA Inc. portfolio. Then what we show below that is how the various funds performed. So if you take Fund VII, Ethos Fund VII at the top there, it's got 12 portfolio companies, it's valuations were up 18% over the last 6 months, 31% over the last year. So a very strong rebound from what has been a very difficult performance over the last 3 years. So a strong rebound in the Fund VII portfolio. If you take Ethos mid-market Fund I, that's our mid cap fund, 8 portfolio companies within that, I think the difference here is a 12% increase over the last 6 months and only 13% over the last year. So a very strong second half performance. And again, we'll unpack that in a bit more detail later. Really, it revolves around the write-down of Kevro in the first 6 months of the year. If you take Ethos Fund VII, excluding Brait, so this is just the unlisted portfolio. And again, we break it down here between an actual in terms of FX on a constant currency basis. And the reason for that is channel of assets within the AI fund and Ethos Fund VII. And obviously, the rand exchange rate moved from, I think it was ZAR 17.35 down to ZAR 14.25 during the course of the 12 months, so had a very significant impact on the rand valuation of Channel VAS. But on an actual basis, the fund grew at 15% and 17% over 1 year and has grown at 20% a year over the last 3 years. But actually, if you look at the last -- sorry, if you look on a constant currency basis, so it's effectively valuing Channel VAS at the same exchange rate as we used this time last year. The uptick would have been 37% over 1 year and 17% over the last 16 -- 6 months. So a very strong result in Fund VII. And relatively mirrored by a strong performance in the AI fund, 16%, over the last year in constant currency terms and 8% over the last 6 months. I think we'll talk about it later. That's probably paired back to some extent by Tyme Bank, which we still held at cost, and we'll talk a bit about that later. Obviously, from a Ethos Capital perspective, we have a pretty significant exposure to Brait. And as you can see at the bottom there, its NAV grew 2% over the last 6 months and actually went backwards 4% over the last year. So on the right-hand side, what we do show is despite relatively good performance in the various underlying funds, Ethos Capital has a bit of overexposure to Brait, Kevro and Primedia, which has dragged down the overall return of the portfolio. Talking about the multiples of the portfolio companies, you can see how they've changed since June 22 -- sorry, June 20 last year to June 21 this year. Slight increase, 9% increase in the multiples. This is on an aggregate basis, going from 13.1 up to 14.3. The Ethos Capital looks through multiple -- has grown from 7% -- sorry, 7x EBITDA to 7.3x, which is a 4% increase over that period of time. So the 7.3 as a proportion of the 14.3 shows just under a 50% discount that we attribute to the underlying companies versus their peer groups. Just trying to unpack the results a bit further. What we've tried to show in the chart is the 6% increase that I mentioned since the ZAR 8.65 as of December, but only a 1% increase from this time last year, I think, shows the difference that I mentioned around the first half's performance and the second half performance of Ethos Capital. So year-on-year, the unlisted portfolio did actually perform very strongly. It was negatively impacted by ZAR appreciation, as I mentioned, particularly around Channel VAS and the underperformance of 4 COVID-related assets by that Twinsaver, Kevro, Primedia and Ster Kinekor. But on a constant currency basis, it achieved a 15% return, a 7% return on an actual currency basis. And actually, if you exclude, and I know you can't do that, but before everyone jumps [indiscernible], but just to give you some context, if we do exclude the 4 COVID-related assets, Twinsaver, Kevro, Primedia, Ster Kinekor, the actual portfolio would have increased 23% in constant currency terms. So I think it does show, to some extent, the strong bounce back in the portfolio over the last 6 months or so. So reading that chart on the right, ZAR 114 million of the increase in valuation came through earnings, that's a 59% growth in attributable EBITDA that I mentioned. 71% -- ZAR 71 million came from an increase in the multiple, again, really around Channel VAS. And then if you look on the right-hand side, the ZAR 116 million negative from FX movement is all attributable to Channel VAS. So 50% of Channel VAS' value appreciation during the year was knocked down due to strength in the rand over the dollar moving from ZAR 17.37 to ZAR 14.27 over that period of time. The listed investments resulted in a negative NAV that's largely attributable to Brait of ZAR 50 million, which gives you ZAR 1,827 million as the valuation of the portfolio as of the 30th of June 2021. As I mentioned, the LTM of the portfolio revenue and EBITDA grew at 11% and 59%, respectively. And again, I think that is much more balanced towards the back end of the year than it was in the first 6 months. Liquidity perspective, we remain pretty fully invested. We currently have a ZAR 500 million facility from RMB, which is unutilized as of the 30th of June. We have about ZAR 41 million of cash sitting on the balance sheet. And we have current net undrawn commitments of ZAR 282 million across the Ethos Funds that have yet to be drawn. In terms of COVID, I don't want to dwell too much on COVID. Whilst it's not in the past, we do think it's going to be prevalent for some time going forward. I'm sure investors are tired of hearing about the impact of COVID. I think the last bullet point under that section on the COVID impact shows a very strong bounce back that we've seen in the portfolio companies. And very -- many of those portfolio companies are now trading at EBITDA's and revenues significantly above both forecast, but actually above their 2019 levels, which I think talks to the costs that we're taking out of the business and the benefit of operational leverage in those entities. In terms of investments and disposals, I mentioned ZAR 150 million of proceeds received during the course of the year, which is a 15-odd-percent of our market cap. There was a relatively insignificant amount of new investments this year. Most of them were done in the portfolio companies themselves. So there wasn't a significant drawdown on capital from Ethos Capital. We had a partial sale, as I mentioned, of 14% of our Channel VAS stake was completed in December, and that resulted in about ZAR 75 million flowing back to Ethos Capital and an IRR of 25%. And during the course of the year, we continue to see very strong dividend flows, ZAR 34 million of dividend flows returning to Ethos Capital from Channel VAS. Equalization proceeds of ZAR 26 million, we received when the final investments went into the AI fund. That was obviously done at a premium to where we put in the money, given that the NAV in that fund had risen over that period of time. And then from a disposal perspective, the DGB sale completed in April and the proceeds -- some of the proceeds we received in March 2021, and the sale of Iceland proceeds were largely received in September 2020 at an 83% premium to Brait's NAV at the time. I think probably the most important point on this is all the disposals that have happened during the course of the year, in the various funds, have happened at -- and I put it in a significant premium to where Ethos' prevailing valuations are, which I do think gives us quite a lot of comfort that when we go to exit our assets, we are certainly not overvaluing the NAV of those. In just about every -- well, in every case, it was at a premium and in some cases, a very significant premium to our NAV. From a strategic outlook perspective, we'll touch a bit later on a slide which talks to our strategy. The focus of the Ethos Funds really is around optimization and exits. A significant number of the assets now sit in the exit launch, and we'll talk a bit about that later. And from an Ethos Capital Board perspective, the focus really remains around maximizing value and returning capital -- returning of and -- returning capital to shareholders. And what the Board has determined, and we've said this in many occasions, if there won't be any new fund commitments until we start to see shareholder distributions and the ability to allocate capital across share buybacks and other means of returning capital to shareholders. Just a very quick overview of how some of the portfolio companies have performed. We'll go into detail of them later. So I won't spend too much time. But very pleasingly, if you take the top 6 assets in the unlisted space. Channel VAS, very strong increase year-to-date EBITDA up 21%. That growth has continued, in fact, probably increased a bit during the last quarter. The development pipeline remains very strong and growth opportunities from both geographic, but also product diversification are starting to show up in the P&L. From an echo perspective, really a story of 2 halves. The South African business really performed fantastically. Year-to-date EBITDA is significantly ahead of budget. Lots of new contract wins and very good cost control. The problem for the business really revolved around the international business, really the Gondwana deal that took longer to close during the -- and obviously, the lockdown restrictions didn't enable the ability for the team to travel there. So we are focusing now -- well, the management team is focusing on the integration of that business. And there are a number of other acquisitions in the pipeline. So overall, a decent result from echo, strong from South Africa perspective, but the international business has faced the headwinds I referred to. Vertice Medical Technology business that we talked about. Year-to-date EBITDA up significantly, up 25%. Despite being impacted by the elective procedures, I'll talk a bit about that when we talk to you, but overall, a pretty good result with a number of smaller bolt-on acquisitions during the course of the year. Synerlytic demonstrated pretty solid performance. A lot of costs came out of the business this year. We've continued to -- management continued to implement some of the initiatives we talked about, really talks around diversifying product and customer concentration, which has started to pay off. GammaTEK really has been one of the star performers in the last 6 months at a very tough first 6 months. Very, very strong performance in the second 6 months of the year, 15% growth and significantly ahead of management forecast, and that has continued into the new year. So a pretty resilient performance despite many impacts of COVID, to be honest. And obviously, the civil unrest did really impact this business, particularly around some of the store closures in some of the KZN and Gauteng regions. Primedia, as we mentioned, probably the last 6 months has really seen -- has continued to see a significant pullback in ad spend. Although there are early signs of recovery, I'll talk a bit about that when we talk about Primedia, relatively positive around ad spend, but also more perfectly around Primedia's market share growth. And Ster Kinekor, as you know, was put into voluntary liquidation at the back end of last year, an absolute -- impacted directly from COVID. That process is still ongoing. We continue to monitor it, but we've written the valuation of the asset down to 0. Just quickly talking about the Brait portfolio or the listed portfolio that we talk about. Primedia, very strong -- sorry, Primedia, Premier very strong performance. Year-to-date EBITDA is up 17%. It had a strong performance at the back end of last year with EBITDA up 14%. Strong cash flow generation has also reduced gearing. So that's been a positive impact on the Brait NAV. The integration of Mister Sweet acquisition, which completed during June, and management continues to be highly focused on enhancing the operational efficiency across the portfolio. Virgin, a bit of a story of the various territories. The U.K., we went through a very detailed restructuring plan during the course of the year that completed in May. Since the opening up in the U.K., very strong performance out of the U.K. business, which has been very pleasing, both in terms of terminations and sales. The Italian business opened up at the back end of May. And we started to see most people go away, as you know, in May and in Italy. Since they returned in September, sales have been pretty strong, back to pretty close to 2019 levels. And that business continues to ramp up from where it is today. The APAC business, the business remains closed in Australia and Thailand, opened in Singapore, but with significant restrictions for members. And then the South African business has actually been pretty robust during the course of the year, but it is trading under difficult conditions, particularly until 2 weeks ago, there were restrictions in terms of number of people that you could have in your clubs, really difficult to do sales campaigns when you've got people queuing outside your clubs. Obviously, in the last 2 weeks, we've seen that reverse with going down to Level 2, and that's been very positive for the business. I think importantly on this, we've just gone through a very detailed 5-year plan. On the longer term, it is going to take a long time for this business to recover from COVID. We know that. We've said that. But all territories are expected to be cash flow positive during the course of 2022. So New Look, again, not dwelling much on it other than to say the performance has been pretty robust since reopening again in around mid-April. EBITDA of ZAR 15 million for the first quarter of 2022 versus a loss of ZAR 16 million last year. And very pleasingly, liquidity, which is effectively our cash net of the overdraft of ZAR 113 million, up from ZAR 78 million in the previous quarter, so a pretty strong performance, driven both by the bricks-and-mortar business as well as the e-commerce platform. And Consol has continued to trade very strongly, 23% up year-on-year. It's been a great -- continues to be a great business. And the management has -- the capacity constraints that we've had now hopefully, I think of the past as we're starting the Nigel 2 expansion, which has recommenced during June. It will take some time to get up and running, but we recognize the need to continue to spend money on the asset. One of the slides I just wouldn't mind spending a couple of minutes on Ethos capital strategy as determined by the Board. We get a lot of questions from our investors around what is the strategy for Ethos Capital? And just before I go there, I think there's 5 phases to the business. The first is what we call a commitment phase where we provide commitments to the funds. As I mentioned before, we only have ZAR 282 million of net outstanding commitments. All of the other commitments have already been drawn. If you talk about the investment phase, that's the early days of putting assets on the books. We currently only have 2 assets, I think, sitting in this box, which is around 14% of our unlisted NAV. And an average age of those assets just over 2.5 years. Then we have what we call the asset growth. When we're seeing the investment that we've made into the business start to show and grow EBITDA and revenue. At the moment, 9 of the unlisted assets sit in this box, which represents 80% of the unlisted NAV, and those have an average age of around about 3.5 years. And then very pleasingly from the point of last year, we now have 5 assets which sit in our exit bucket or realizations bucket. Let's call it ZAR 100-odd million of NAV. It's 6% of the unlisted NAV. Age of those assets is just under 7 years. So clearly, the key issue is once those assets are realized and [indiscernible] is required, then the determination from the Board is do you return the capital to shareholders in some form? Or do you continue to invest into new funds or new investments? On the right-hand side, what we've set out the 6 key pillars of the strategy the market-leading shareholder returns. And that includes where we talk later on about -- earlier on about benchmarking. Private equity has a longer term horizon, obviously, the most listed assets. But the key issue for us is to generate market-leading returns from the private equity portfolio. The second is to manage liquidity whilst optimizing shareholder returns. Clearly, we need to manage liquidity. We have commitments that we've got on this page. We need to be able to honor those. Otherwise, you get diluted to the extent that you don't follow your rights, but we also need to optimize shareholder returns in the form of whether it be buybacks, et cetera. That talks to capital allocation, which I'll refer to later. The next is NAV per share enhancing use of proceeds from any realizations. I mean cutting to the chase, if you had ZAR 100 million a day, what is the base capital allocation strategy to enhance NAV per share? Obviously, buybacks form a part of this, new investments form a part of this, secondary transactions form a part of it. And from a quantitative perspective, we need to ensure that we're using it in a way that will enhance NAV per share for shareholders. The next is we focus on minimizing the share price discount. Now obviously, there's 3 ways to do that. The first is structural considerations. Are there structural efficiencies or inefficiencies in the platform that we need to iron out? We don't think there are those within Ethos capital, certainly not from a tax structuring or a cost perspective. The one you could argue would be the dual entry into Brait and Ethos Capital, which is something that we are considering. Capital allocation is clearly a key part of reducing that discount, and that can talk to share buybacks and the like. And the last is ROIC. Growing return on invested capital is an absolute sure way to close the discount as quickly as possible. Then we need to be able to utilize -- under number 5 there, utilize share buybacks as part of the NAV per share growth strategy. But this needs to be a quantitative approach. It's relatively simple to do, quite frankly. There's only 3 issues that you need to focus on. The first is the current prevailing discount. The second is the growth in the new investment opportunity. And the third is the growth in your existing platform or your portfolio. And those 3 will very quickly determine for you, should you use ZAR 100 million to do a share buyback or to put it into a new asset? And it's very simple. At the end of the day, if your discount widens, obviously, your ability to put money into new investments is significantly more difficult because your hurdle that you need to get over is significantly higher. So we continue to look at all of those. It's a very quantitative approach to this. We are 100% on the same page as all of investors that buybacks are a very important way to increase NAV per share. And then the last point on the slide is reinvestment in funds, all secondary transactions. Those are buying existing investments into existing funds, where return expectations will exceed other capital allocation alternatives. So it's not to say we will not reinvest. We want to see capital coming back first, clearly. But to the extent we do, clearly, we need to make sure that wherever we're putting our capital maximizes the NAV per share for our investors. Then just moving quickly on to the portfolio itself. Again, not to dwell too much on this slide other than to point out a couple of things under the changes year-on-year. If you look at Channel VAS at minus ZAR 11 million, what that does -- what it does is the ZAR 34-odd million of dividends and the disposal proceeds of ZAR 75 million. So about ZAR 115 million, you need to add to that negative ZAR 11 million to get to what the return was on Channel VAS. [Audio Gap] Negative ZAR 95 million. More than ZAR 100 million -- about ZAR 120 million of that is taken up by Primedia, Kevro, Ster Kinekor and Twinsaver. And again, we'll touch on a bit of that later on. But if you look on the right-hand side here, from an audited NAV per share perspective, you'll see at the bottom there, the ZAR 9.19 or the ZAR 6.67 if you include Brait at its current share price. In terms of the portfolio, 84% of the portfolio sits within 8 key assets, and those are the assets that we'll talk about today. From a valuation perspective, 56% of our asset base sits within South Africa; 39% really around the rest of sub-Saharan Africa; and the international component of our NAV is around 5%. But that gives you a pretty good indication of which are the key assets that are going to drive growth in NAV of the portfolio going forward. Just moving on to -- at a high level, how does the portfolio company done from an earnings -- from a revenue and an EBITDA growth perspective over the last 12 months? These are the unlisted portfolio companies. So if you look at the top from a revenue perspective, almost 90% of our companies by value grew revenue year-on-year. 50% of them grew it at more than 15% year-on-year, which I think in a tough environment is a pretty good result. From an EBITDA perspective, 90% of the portfolio companies grew our EBITDA, and just about 40% of those grew their EBITDA at north of 15%, which again, I think, talks to a pretty robust performance despite the impact of COVID. On the right-hand side, if you take the LTM return, which assets have enhanced and detracted from the value? The first is Channel VAS, up by ZAR 106 million a year, up 18%, 1-8, over the course of the year; Synerlytic up 43%, up 34% for the year; Gammatek had a very strong bounce back, as I mentioned, up 43%; and Vertice up 16%. AutoZone, again, an asset that has been -- had a very strong bounce back, albeit off a low base and increase its valuation by 80-odd percent during the course of the year. On the detractors, you can see it starting at the bottom, Kevro had a very significant downward impact on the valuation of the portfolio, as did Twinsaver and Ster Kinekor. We wrote Ster Kinekor to 0. So you can see it's 100% decrease in value there. And Kevro was written down by 50% year-on-year. So again, as I mentioned, if you take Primedia, Ster Kinekor, TwinSaver and Kevro, that's about ZAR 120 million or value that was taken out by the COVID-related assets. Just quickly touching on some of the multiples. These are the multiples that the market is implying on the value of our various portfolio companies. So again, if you take Channel VAS, for example, and you reverse out the current discount that we trade at, the market is currently valuing Channel VAS at about 4.7x or 6.6x P/E ratio. And again, if you read across to the right, you can see the various assets and how they're valued by the market. The overall average, as I mentioned, is the 4.7 that I referred to on the first page. Just taking a look at the constitution of the portfolio. Channel VAS and Brait's -- the listed value of Brait effectively contributes the current market cap of the business. The market value of Brait listed values move from ZAR 369 million to ZAR 520 million today. So if you take ZAR 537 million and ZAR 520 million today, you more than cover the current market cap of Ethos Capital. So we continue to trade at a 40% discount to the share price if you put Brait in there at its share price or 56% discount if you attribute with Ethos Capital NAV. Now I'll just delve into the various portfolio companies. As I mentioned, what we tried to -- this is the investment thesis that we've invested behind. How does the financial performance have been over the last 2 years? And then over the page, we'll just talk about what are some of the value creation and growth initiatives that are out there for the various businesses? So again, if you talk to Channel VAS, Channel VAS makes up 28% of the total asset value of Ethos Capital. At ZAR 537 million, year-on-year increase in value was 18% and it currently sits at a TMB or times money back of 1.81x. It's one of the leading Fintech providers that's got mobile financial services and Airtime Credit Services as its 2 key pillars. And if you look at what it does? It really leverages proprietary data analytics to drive financial inclusion in the unbanked population, if you had to put it into a one liner. It's got market-leading credit scoring capabilities, which is over many, many years driven very low default rates of less than 1% in its Airtime Credit Services business. It's present in over 30 countries on 4 continents and really has proved its ability to expand geographically and leverage its relatively small fixed cost base. You take its global footprint, it's got a captive user base of 530 million. I always have to repeat that to myself, 530 million customers, it uses through its proprietary data analytics platforms. And it's got 28 MNOs and banking partners. So a very, very broad spread of MNOs and partners across many, many countries with a very significant number of customers. The platform is now starting to be leveraged to expand their product offering into mobile financial services. I'll talk a bit about that just now. But pleasingly, for the first time, mobile financial services had a pretty significant positive contribution to profitability for the year. So if you take its financial performance, LTM revenue growth up 19% in dollars. Airtime Credit Services advances over the last 12 months of ZAR 2.6 billion -- circa $7 million a day, which is an increase 20% year-on-year. And then EBITDA over the last 12 months increased by 13% in U.S. dollars. But to give you some idea of the latest numbers, and I'm talking about year-to-date, these are the first 8 months of the year to August. The Airtime Credit Services advances are up more than 30% in the first 8 months, so a significant uptick on the 20% of the LTM. And we're seeing that through a significant increase in the number of recharges, the number of times people go and recharge airtime on their devices and also very pleasing increase in the ARPUs of those various customers, average revenue per user. We're seeing the benefits of new deployments, although some of them have been delayed during COVID. The benefits of those are starting to come through into the numbers. Very low default rates and cost management have driven very strong growth in EBITDA over the last -- over the first 8 months of the year and again, very, very strong free cash flow. This business doesn't have any debt, very decent -- very strong margins and extremely high free cash flow generation. And very importantly, there's a strong pipeline of new deployments that are currently in place, and management is very positively disposed to those. Just dealing quickly on the mobile financial services. So this is the new pillar that I referred to. Advances increased 4x over the last -- on a year-on-year basis, up to $50 million with -- and the average tenor on those advance is about 30 days. Defaults have been in line with management's expectations. A very significant increase in the number of new deployments. And we're looking at different JV models, which have been trialed over a number of different countries, from providing me a credit scoring and not taking any risk on the 1 book end, all the way over to the other book end of risk sharing where we take risk sharing with our partners. So again, a very strong performance, not just over the last 12 months, but probably it's continued to pick up as COVID is somewhat dissipated in some of its key markets. Clearly, FX continues to have an impact on this business in twofold. The first is weakness during the course of the year, obviously, had an impact on profit that was outstripped by the growth that we saw in Nigeria, which is positive. And there weren't any convertibility issues. It was merely a case of what -- the impact that the FX had. And secondly, from an Ethos Capital perspective, this is a U.S. dollar-based asset. At the end of the day, we value it in dollars. So whilst the increase in the valuation in dollars over the course of the year was 41% in dollars, given the strength of the rand versus the dollar over the course of the year, the increase in the valuation of Channel VAS and Ethos Capital's accounts was only 18%, which is still a very good result, but obviously, nearly half of -- or more than half of the value increase in Channel VAS was dissipated away through the stronger rand. I think that's at 14.25. Obviously, the rand is now blown through 15, so that will be positive, hopefully, in the next quarter. Very importantly, 33% of the growth in the valuation, 33% growth in EBITDA, maintainable EBITDA during the year. We were relatively conservative in the course of last year where we took a view in the midst of COVID as to what could happen in Nigeria that didn't play out. And so some of those we reversed during the course of the year, which resulted in a very strong growth in maintainable EBITDA. And a slight increase in the multiples. To give you some idea, the peer group, which we monitor this business against increased year-on-year, its multiples from 19.7 to 20.1. I just want to reiterate, we don't value at anything like that multiple. But just to give you some idea of the peer group that we measure against, their multiples increased from 19.7 to 20.1 during the course of the year. In terms of the growth outlook for this business, your value creation opportunities. I mentioned mobile financial services, accelerating that and leveraging the current ACS footprint and pipeline and platform is obviously going to be key. We see a number of potential M&A opportunities in this business. We've had a number that we -- 1 or 2 that we've added, which have positively contributed to growth, relatively small. And the last is diversifying profitability in the Airtime Credit Services businesses by -- both by customer and by geography. Despite the fact that Nigeria has continued to grow and be very strong in our portfolio, we are looking to obviously continue to diversify away from our Nigerian only exposure, which we've done very, very successfully. That number is down to less than 35% -- or about 35% of the overall revenues. From a growth opportunity perspective, upselling our existing products and increasing transaction frequency, that really talks to what we talked about -- earlier about ARPUs and obviously getting further -- usage out of our customer base. And I think very importantly, if you look at the point below, there's 1.7 billion people that currently remain unbanked in the key markets in which we operate. That is obviously growing rapidly. We believe that we only have currently 30-odd percent of this being penetrated. So that provides a massive opportunity to continue to grow organically in this business. And then the last one, as I mentioned on the bottom bullet point, we're going to leveraging the existing platform, and we're starting to see it by expanding into adjacent products. This is the mobile financial services I mentioned. Those can be utility-type loans, SME loans, Buy Now Pay Later products, mobile money partnerships. Again, leveraging the platform that we currently have provides for a really great opportunity for this business to continue to grow. Moving on to Vertice. Vertice as I'm sure most of you know, is a medical technology and it supplies a variety of applications and products, really across most of the health care but predominantly to the doctor base. It constitutes about 9% of our NAV. Current valuation of about ZAR 176 million, valuation up 16% year-on-year and a TMB of just below 1.5x as of June. If you talk about the investment thesis. Why did we invest? Why do we like this business? We set this thing up as a platform to grow off. We bought the first business called Amayeza back in 2018. Since then, we bolted on 7 acquisitions. They've all been fully integrated into the business. These are not run separately. They're fully integrated into the Vertice business. And we genuinely continue to believe that medical devices are 1 of the most attractive growth segments in what is still a very defensive but growing in the health care industry. So we've seen the growth come forward over the last 12 months, and again, I'll try and pack it a bit later. We do believe we now provide a really differentiated product and services to -- both for getting skilled people into onto our platform around the sales force, but then be able to talk to all of the big distributors globally and say, we can be your partner in the South African context. The scale that we now have and have provided -- and the insights we now provide through AI to our product partners, really, I do believe differentiates us from everybody else. It's a very highly scalable platform. You don't need to increase the cost to grow organically. And we've seen that through the M&A that we've done. But we've also seen it through organic growth, just getting better at what we do going forward. And health care is fundamentally being transformed by AI. This sits in our AI platform alongside our mid-market fund. And we really are starting to see the benefits of that. I actually went the other day for our medical, and I had a heart monitor stepped on to my chest for the 3 days and the data that came out of that and what it told me about how badly I was sleeping and how stressed I was. I should have listened to my life, but really just shows you the impact that this could have going forward. If you take the financial performance of the business, revenue more than doubled over the last 2 years. Now some of that is obviously organic. Some of that is through acquisition. But on a like-for-like basis, revenue during the course of the year was up 13% and EBITDA at 10%. I think to give you some context to that, this business really was impacted very significantly. About 50% of its revenues are due to electives in some shape or form. And obviously, during COVID, that's been -- many of those have been postponed. But to give you some idea, from the start of this year to what the impact could have, so this is our start of the year from March to May, so it's got a February year-end of 2022. In March to May, like-for-like EBITDA doubled compared to the first quarter of '21. And that's because electives came back. They bounced back very, very quickly. From June to August this year, like-for-like growth has been 16% up, and again, due to the lack of electives during COVID. So this business will continue to be impacted by COVID. So I think an EBITDA growth of 10% during the course of the year when -- for the majority of the year, we've been prevented from having electives, I think, shows a resilient performance. And if you look at the EBITDA on the bottom, we raised to 100 -- it's nearly 2.5 fold higher than it was in June 2019. From an equity value perspective, the valuation increased by 16% year-on-year. And this was driven by like-for-like increase in EBITDA, as I mentioned, 10%, and a very slight increase in the multiple. Just to give you some context here, the peer group multiples that we benchmark again increased from 9.4% to 10.9% over the last 12 months. We've increased very, very slightly, much less than that increase. Moving on to the opportunities for Vertice going forward. In terms of value creation opportunities, it's really around increasing and introducing new products and driving this through M&A as well. And then obviously, digital transformation of the business. We're very, very excited about what we've seen on that front already. The CEO has that as his mindset. He comes from that as a background. And we really do think that will differentiate us from other competitors. If you look at the growth opportunities at the top -- if you look at that box, Vertice only has about a 4.7% market share, makes it the second largest MedTech player in Discovery Health, but it's still only got 4.7%. I mean it's grown very, very significantly from less than 1, but it's got 4.7% of what we think is a very rapidly growing market. And I think it's rapidly growing in 2 things. If you look at the bottom left-hand side, we have less than 20%, and this is obviously by value, of market share in the categories in which it currently plays with Discovery Health. So take surgeries in consumables or cardiovascular. We have somewhere between 12% or 18% in cardiovascular, which shows that we have very significant room to grow our market share in each of those verticals. And then on the right-hand side, what it also shows is in most verticals in which we play, we actually don't play in more than 50% of the categories or products, right? So this gives us the ability to say, in those verticals we're already playing, how do we expand our product range within each of those verticals to increase our market share? So I think we've got room to grow market share. We've also got room to grow our product capability, and that gives us a lot of comfort that this will be continue to grow as a business, particularly in a post-COVID world. Moving on to Echo. I think I touched on it earlier a bit, talking about its performance. It really is a story of 2 halves. The first is the South African business. Largely, it's a corporate Internet service provider with IT services, et cetera, provided to really to the mid-tier of corporates on an SA basis. It really has performed very significantly, very strongly in South Africa. The GP was in line with budget, but actually EBITDA was more than 50% ahead of budget in the year-to-date. So that's a very strong performance from the South African business. And if you look at what drove that during the course of the year? Obviously, network upgrades and new products that were launched with our customer base. Our international revenue has been behind budget, but we're close to signing a number of large clients that we would hope closes the gap to budget relatively quickly. And there's a strong pipeline of deals with particularly MNCs. So we've always said the strategy of this business is to create scale so that we can offer -- in other countries that we can offer MNCs the ability to do their services across all of the sub-Saharan Africa. And with the Gondwana acquisition and 1 or 2 infill acquisitions we've made in Namibia and Zambia, we really do now have a platform to be able to do that. And a couple of MNCs we currently talked to could really materially change the revenue profile of this business. So it's relatively early days, but that would be a massive win for the business. So if you look at the investment thesis for this business, really, it's about increasing its market share in the mid-corporate segment. It's driving cross-selling of existing products, which we continue to do up -- moving up from our core basic offering into more value-add products. And then it's targeting multinational companies. As I mentioned, if we can get 1 or 2 of the big multinationals and service their requirements across sub-Saharan Africa, that really will transform this business to the next phase. If you look at its financial performance, I think, again, as I mentioned, on a revenue basis, the top chart talks to group revenue. Whilst it is up from June 2019, it came down year-on-year, circa 8% revenue drop. And really, all of that was attributable to a decrease in the international division. The South African business revenue grew 17% year-on-year given its strong new contracts that it entered into. With tight cost management, the South African business managed to exceed its budget from an EBITDA perspective. And you can see that in the table below. That's the LTM revenue in the South African business, up nearly 40% from June '20 and whatever the number is look at 22% since June '20. So from a value perspective, the equity value of this business decreased 3% year-on-year, really driven by the reduction in the maintainable EBITDA attributable to the international business. And we slightly decreased the multiple again to give you a context, the peer group multiple actually moved up from 12.5 to 13.7x, and this -- we valued at a significant discount to those multiples. [Technical Difficulty] were slightly down during the course of the year. The outlook for this business, as I mentioned, on the value creation opportunities to serve multinational corporates across various geographies. I think we're there. We can do that. We're starting to have the ability to have extensive discussions with these multinational corporates and turning 1 or 2 of those into revenue will be a significant transformation for this business. We continue to look at complementary acquisitions, infill acquisitions we made some in Zambia and the Namibian market, which really have added to our portfolio. And then it's really about driving sales force effectiveness, getting into those companies that we currently have or don't have and driving new products or additional products through that, and cross-selling the products and services that we have. But if you talk to this business in terms of an outlook, we start -- we're talking about JVs in new regions with certain partners. Certain services switched off during COVID, come back relatively quickly. And then last, demand for data continues to grow. I think in a post-COVID world, that's unlikely to change. And clearly, that plays right into the sweet spot of the echo business. Moving into Synerlytic. Synerlytic has had a pretty strong performance in EBITDA during the course of the year. This is a business that has really 2 key parts to its business. The first is WearCheck, which is a leading condition monitoring and fluid and analysis specialist in Africa; and the second is AMIS, which talks to certified reference materials, really talking to the miners and across the world. And how the business performed? It has performed pretty well. WearCheck has been under pressure, obviously, with COVID. It's been very difficult to get in to see some of your customers and service those customers well. But on the other hand, the AMIS business has really been a beneficiary of a very strong commodity price cycle. So the combined part of that was a very strong -- relatively strong growth in top line and very strong growth in EBITDA. The growth in EBITDA this year was driven, as I mentioned, by strong AMIS performance; new acquisitions, which have performed very, very well. We bought, for example, Anglo Financial Services, I think it was called in this space. It's had a 2-year payback. We've integrated it, and it's performed beyond our best expectations at the time of the acquisition. So new acquisitions continue to perform well. And we removed a significant amount of the helpless costs that we inherited with this business during the course of the year, which resulted in a pretty significant increase of 25% in maintainable EBITDA, a very small increase in the multiple during the course of the year meant that the equity value for this business was up by 34%. From an outlook perspective, as I mentioned, the back end of COVID will be a positive for this business, particularly around WearCheck and being able to get into service its customers better. Obviously, there's been some paring back of the commodity price impact on AMIS that we will probably see that over the course of the next 12 months or so. But very pleasingly AMIS made an acquisition in Canada to give it a global -- to give it much more global reach. That was integrated into the business and is performing very well. As I mentioned, the acquisition of Anglo Field Services had a 2-year payback in the context of WearCheck and then that's been in that -- you'll see that in the numbers. Clearly, this business does need South Africa to come back on a growth profile to really flourish, but it's been a pretty decent performance in what has been a very difficult space for the business over the course of 12 months. Moving on to Gammatek. Gammatek, as you know, is a leading distributor of mobile accessories and low technology products. The business has had a very, very significant bounce back. If you look on the right-hand side from a revenue perspective over the course of the last 2 years, revenue went from ZAR 100 million to ZAR 88 million bounced back to ZAR 110 million. But even more pleasingly, from an EBITDA perspective over the last 12 months, a very, very significant increase from -- the equivalent of a 17% increase in maintainable EBITDA, but EBITDA has actually grown by 50% during the course of the year. So revenue being up 25% year-on-year with EBITDA up 50%. And if you say what's driven that? The first is an increase in demand for devices during lockdown. So people buying new phones, et cetera, or new iPads that plays into accessories, which we sell. Supply is also providing fewer accessories in the box. So these days, when you buy a new phone, you don't get all the bells and whistles you used to get. You now need to buy them, and most of those products are now bought from a Gammatek stable. And very importantly, 2 new -- very key new client wins. So Samsung added very significantly on a per month basis to revenue with the products that we now sell for Samsung. And then we managed to get into the MTN stores, which have been excluded from -- well, to say that we're in 50% of the MTN stores, currently getting our way back to 100%. And both of those contributed very, very significantly at the back end of the year towards revenue growth. And the last is online sales, which we've obviously seen a very significant uptick on. So a very strong performance. Now if you had to look at the issues in this business. The issues remain around supply chain challenges, getting product in from around the world has been more difficult and slightly more expensive than it was 12 months ago. And clearly, the July riots here with store closures and the like didn't have a great impact on July, although the August performance was very strong. And very pleasingly, the cash flow generation in this business has been quite spectacular, quite frankly, and the net debt in this business is now down below 2x net debt to EBITDA. So a very strong performance in this business. As I mentioned, the equity value of 43%, largely driven by maintainable EBITDA growth of 17%. We reduced the EV/EBITDA multiple given that the peer group went from 9.4x to 8.1x. But the very strong cash flow, which drove de-gearing in the business led itself to a revaluation of the asset. Then on to the last one of the unlisted assets being Primedia. I think Primedia is well known to everyone. It's very strong in the broadcasting and outdoor media space. The investment highlights when we invested into this business, it remains a market leader in an industry which has extremely difficult for the barriers to into the space [Technical Difficulty] free cash flow generation and a pretty [Technical Difficulty] business. We've continued to see that during the 12 months. Very significant pullback in advertising. You can see it in revenue there, declined by 12%, with EBITDA down 19%. Still very strongly cash flow generative, but obviously down 19% year-on-year and very significantly down from a pre-COVID world. Pretty importantly, though, we are starting to see the early signs of recovery. There was probably more than 25% increase in the LTM EBITDA in the last quarter. So if you take -- if you show what -- that means, obviously, we had a very significant rebound in EBITDA in the last quarter, more than 25% in LTM EBITDA. We've seen a cautious increase in ad spend, particularly over the last quarter or so. And very pleasingly, the market share of Primedia has increased from around 19% at its lowest to 24%. And I think that just shows the bounce back in the key sectors in which it operates. So financial services, auto and retail have bounced back pretty significantly. The July unrest did have an impact on ad spend. They turned the tap off during July. But very pleasingly, we've actually seen most of that plus some recovered during the month of August. We've reduced costs in this business by over 10% during the COVID-over the last 12 months. And very importantly, we board in a new CEO with international experience, actually happens to be a South African, who spent many years abroad, the last 3 to 4 years of that being in Greece, running the broadcasting businesses around the world, the guy called Jonathan Procter. And Jonathan took over at the beginning of September, and has some very good ideas about how to take the business forward. So obviously, not a great performance year-on-year. Equity value down 19%, a 14% reduction in EBITDA, a slight increase in the multiple, which reflect the fact that the peer group here went from 9.7 -- 7.9x EBITDA a year ago, up to 13.1%, which is, I think, more a reflection of the fact that the bottom line in all of these advertising-related businesses have been impacted. So touching on some of the other smaller assets. I won't dwell too much on these. Kevro constitutes 3% of our asset base. As you know, we've got a new management team in there that resolved most of the issues that we saw during the course of last year. Volumes have significantly increased. They still remain below, I think, what we would hope or our expectations. I think that's largely been due to some of the restrictions that we've had on the supply side and some of the civil unrest. But actually, this business is in far better shape. We wrote the value down, as I mentioned, very significantly during the course of the year. But we are relatively hopeful that we'll see a bounce back in this business. AutoZone has been a perennial underperformer for a number of years. And very pleasingly, we've seen a massive turnaround in this business. EBITDA has significantly improved during the financial year, exceeded budget. It continues to perform strongly. Obviously, it was impacted by the June riots, but again, has bounced back relatively quickly. So a strong performance by this business. Tyme Bank, without dwelling much on it, I think most people know Tyme Bank, one of our partners in that business, announced their results a week or so ago. Pretty strong performance around transaction values and customer growth, which is very pleasing, probably ahead of what we could have thought would have happened. I think very importantly, the cash to breakeven has been substantially reduced. Very, very significant costs taken out of the business. And then probably most pleasingly, there was a ZAR 1.6 billion capital raise done in February. It constitutes 2 tranches. The first was at the same price that we held it at. The other, which will close in the next couple of weeks, is at a 30% premium. We still hold this asset at cost. So given the second tranche is about to happen, we will probably have -- well, we will write this asset up to probably reflect the 30% higher valuation that the second tranche is happening at. Eazi, again, have been a difficult asset for a number of years. Trading has been in line with budgets. Ongoing cost containment has resulted in very strong EBITDA growth. And we did a recapitalization of this business during the course of the year, and it's losses on the beverage company, a really great turnaround in this business in Fund VII -- in Fund VI [Technical Difficulty] increased growth [Technical Difficulty]. Just briefly, and I won't spend much time on, we had a Capital Markets Day the other day, as most of you from, [Technical Difficulty] tail of 2 different regions, the U.K. and Italy... [Technical Difficulty]

Ladies and gentlemen, apologies for the interruption. Please remain online. [Operator Instructions] Ladies and gentlemen, we have been rejoined by the main speaker, Peter. You may proceed, sir.

Apologies for that. We might be to get [indiscernible] some of our infrastructure. I think I was finishing up on -- I presume I got to hear most of the Virgin Active. So I'll move quickly on to the Premier business. Premier has performed very, very strongly during the course of the year, up 14% to -- as of the end of March. That's continued during the course of the first quarter, which is actually up 17%, largely driven by the MillBake business, to be honest, good volumes across our business and margin retention. So that business has continued to perform well. The acquisition of Mister Sweet, which is a complementary confectionery business, has doubled the market share of Premier in that space, and we would hope to contribute pretty significantly to profitability going forward. That deals with the portfolio of companies. I'll just very quickly touch on the liquidity slide, which we showed 6 months or so. On the left-hand side, our undrawn commitments of around ZAR 406 million, as we call -- those funds will not -- those funds do not draw down 100%. We pay LPs separately, but the other LPs. So you effectively only get drawn on roughly 90% of those funds. So our net undrawn commitments totaled ZAR 282 million. The capacity that we have, including current cash on the balance sheet, is ZAR 358 million plus the treasury shares that we have, we show that ever today, we have surplus commitments of about ZAR 112 million. Clearly, over the course of -- the costs and interest, et cetera, roll up over the course of the next 3 to 4 years perhaps we may be drawn down on those commitments. But currently, from an outstanding commitments perspective, we are more than [ 25 ]. And on the right hand side, we just show the profile of the returns coming back, obviously, some investments during the course of 2022, and then some of the realizations really coming towards the back end of part of full year -- financial year 2024. And then just to finish off with the slide on the outlook, the outlook for the portfolio as a whole. On a positive perspective, I think economic growth is looking positive, albeit of a low base. I mentioned in my report that we have seen a very strong rebound in our portfolio companies. I do think we have a very good cross-section of companies across SA Inc., and we are seeing those continue to grow. So we think consumer sentiment has been surprisingly resilient, quite honestly, given I think the many challenges that we've had globally in South Africa. And I think the operational changes that we made, and we took some tough strategic and operational decisions during COVID, will made to be enhanced the operational leverage. Operational leverage can obviously work against you. But we decided to work for you. Obviously, it's a very significant potential profit generator. We have a pretty robust pipeline of acquisitions and disposals, which I think is pleasing that we will be able to get some return of capital to shareholders during the course of the year, but also some very exciting opportunities to invest the capital as well. There's an increased number of our assets, as I mentioned in the exit lounge or the realization phase. And hopefully, we'll see some of those come to fruition. And we've talked to the last point around quantitative capital allocation will still be the key strategy that the Board uses to optimize shareholder value. Not always told not to put us on the negative, but just to point out, there are some tough headwinds out there. Our overall NAV growth was let down by those COVID-related companies, as I mentioned. Hopefully, the worst of those are behind us and we started to see some uptick in a couple of those core assets already. And I do think the impact of COVID across some of the portfolio companies will remain. I don't think it's going to go away tomorrow, unfortunately. But we need to continue to evolve our strategies there and see how we can either benefit from it or thrive in a very difficult economic environment. Clearly, the impact of the social unrest and increased economic divide is something that I really believe we, as the private sector, need to get together with government to resolve. If we don't, this is going to be an ongoing issue for all of SA Inc. Certainly from an Ethos Capital perspective on our CSI programs, we are very, very focused to close that gap. And then obviously, the COVID-related impact on Virgin Active has required a very holistic restructure that is behind us. And we injected liquidity into that business. The business is starting to look more promising, which is good. But again, as we mentioned on the call the other day, I think it is going to take a number of years to get effect to 2019 levels in Virgin Active. And clearly, the last point, which I think probably iterates to shareholders even more, as much as it has me, is continue to find ways to process the discount to NAV is an absolutely key strategic points that the Board has with investors, and we'll continue to look for ways to be able to do that. So again, apologies for dropping the call, and very happy to hand over to any questions.

[Operator Instructions] Can I hand over to you for questions from the webcast first?

Sure. I only have 1 and it's for Charles. Thanks for the presentation, including additional info on the portfolio investments. They are not large assets, but could you provide some background on the large valuation declines in Twinsaver and Chibuku? I think also beginning with this year with Chibuku first. Chibuku is an asset that we own in the [indiscernible] fund. It's based in Malawi, natural beer business that's based in Malawi, and it was very, very significantly impacted by COVID. As you can imagine, from taverns, et cetera, being closed,plus getting stock into the country has made a very difficult operating environment. The good news is, that business really has had a very, very strong last quarter since they've opened up the taverns. But obviously, we didn't know that when we did the valuations at a view based on the main numbers for Chibuku. And we took a relatively conservative view on that. We obviously have equity sitting behind us. We're there in a mere position. So I would suggest that it's probably relatively conservatively valued where we are today, and we have started to see some benefits of that asset coming forward. Twinsaver has been a very difficult asset to be honest. I still believe Twinsaver it's a decent business that belongs in a bigger -- in my view, in a bigger -- on a bigger platform. You've got all the cost of distribution, sales, et cetera, which when your top line comes under pressure, as it has during the last 12 months, and it's very, very difficult to get rid of some of those costs. So that also has been impacted by negative news. Maybe you've got marginal revenue growth at the top with some cost increases. They've recently gone through a Section 189 in that business to take out a very significant chunk of costs. But again, the part of the valuations, we didn't take that into account. It is forward-looking. Charles -- another question from Charles. If any portfolio company needs to raise significant capital, do you have thoughts on how Ethos Capital could fund this? Charles, good question. Most of our assets are a generalization have relatively low net debt to EBITDA in their portfolio of companies, right? There are some challenged assets we're starting. But the majority of our companies can fund any growth, whether it be acquisitions, liquidity requirements, et cetera, from their own debt facilities. So we would need to put in equity. And when we do, we keep a ready today provision within that number that I mentioned to you on liquidity earlier. We've got a ready today provision there for potential funding for some of those assets. So -- and we take into account in our liquidity model, but there's nothing that we know of now that, that would suggest we couldn't fund it better. Those are the questions I have currently. Anymore. So 2 more. From [ Grant ], please could you provide some insights on the current state of the broader PE market in South Africa and the Rest of Africa? And second question, are you shifting focus of this in acquisitions toward new businesses as opposed to bolt-on acquisitions? Can you elaborate on what sectors you may be looking at? Let me answer the second one first. I wouldn't say we're away from that brand to be honest. I think what we opportunistically look and we challenged one of our portfolio companies to find acquisition targets that are complementary and we add value can add to the platform. And they continue to bring us opportunities there. That said, we are pretty clear on all of them that they need to add value at least to be value enhancing. And so we probably end up doing 1 out of 3 or 4 or 5 deals that have at us by portfolio companies. Yes, we are looking at few acquisitions that are new deals, that are relatively imminent. They're not getting too much away. They talk to you very -- I think very exciting tailwind sections. If you look at our annual report, you can probably get a good indication of where we think the tailwinds are currently. But it's really around those sorts of businesses where we think there's lot of tailwinds in the [indiscernible]. Fintech is a place to play. I think you've got to pay-the-right entry multiple to get into those business, and you've got it back the right management teams. But one of the other assets we're looking at talks to those teams. So really, it's also the tailwind sections that we put in our annual report background. Could you provide some insights on the current state of the broader PE markets in South Asia and Western Africa? Sure. Look, I think it's a lot more positive. I think it's a lot more positive than it was 12 months ago, quite frankly. As you know, Ethos took over the Africa platform of Investec Asset Management or 91 at the back end of last year. So we've taken that over. We see other GP consolidation happening where the GP take over the portfolio and manage them to manage them to exit or create new funds off the back of it. So I think there's probably more positivity than there was 12 months ago again, which is not really surprising. And I think at the end of the day, it's going to be driven by performance. I think we still have to see -- if you look at our side of the performance, we are starting to pick up, and that gives you investors confidence that they use growth in value that you have from playing in an African markets. So we see 2 acquisitions -- sorry, 2 disposals already that we are well advanced on in that 91 portfolio. And the sort there's a lot of international interest going to go back into South Africa and Africa more generally, which I think is a positive. Sorry, a question from [ Marie ]. Well done on the results. Channel VAS still remains an outside position at 28%. All the plan to realize further portion in the near term. And the essential is probably not to be honest. So we opportunistically -- obviously, we would look to do. So there are no plans to do it. But I think there are the ways that you can get value out of the portfolio or liquidity out of that portfolio, it's totally ungeared. So I think we're extremely keen to retain our stake at the current levels. But there's probably ways to -- get the other the answer is just put it that way, that doesn't require us to sell down shareholders. So we'll make of this, but it's a good cornerstone effort to have with lots of growth potential, and we don't see any reason right now why we would sell down. And question from Richard. Do you think Channel VAS growth is too conservative. With such low credit losses should be the turning away a potential profitable time? Richard, it's -- yes, it's a very interesting question and to be honest with the Board spent a lot of time debating. And to be honest, the client -- we've also got different levels. You don't have that to turn the tap and take on the risk. You might find one of the MNOs willing to say they'll take some of the risk. I think our default rates aren't low, and that's an important part of the model. It continues to be -- we've turned the tap on slightly from a context of taking on slightly more risk. But this is not business that you want to might for the last, we can continuously grow the business through new deployments better office from those existing. Again I think [indiscernible] financial services is going to be a very big player going forward in this business. A question from Chris. Financial markets over the last 12 -- over the last year is the voracity of IPOs and new listings. [indiscernible] is not enjoying the strength with for 6 years. How does this impact your business, particularly in terms of realization of business? Chris, a great question. Spent a huge amount of time from my background. I concur with your views. That said, I actually think, and this is not just my view, but views of many advisers who come through our doors, is that actually is open for good high-quality sizable investments in the right sector. We do believe that the market is open. We've had a process from providers of capital, to be honest, to work with us on potential listings where they will put money in. So I think it's a question of pricing, quite frankly. I think you got high-quality assets to the market that are of sufficient size and liquidity and plans to expect invested to have the optionality to plan at the moment. I generally think that the markets are open. We've looked at a couple of other assets to this on some international markets, to be honest. There are more volumes. I think the South African valuations are still low in comparison. So I think that's the big issue. So our valuations more than this is the market. From [indiscernible]. Thanks, Pete. Well done to you the entire pose for the efforts of the invested companies. The operational performance is better than that. From Nick, will you use equity or debt to fund acquisitions. Considering that you trade at discount to book, using equity implies that your swapping 100 for 60 to buy assets? Maybe by make more sense. Nick, I mean I think I mentioned it at the beginning, there's absolutely agree. [indiscernible] at ZAR 100,000 a day, you could -- in excel, I don't take to work on the discount we're currently trading at would you put money into buybacks or put money into your investment? Just to give you a very simple analogy. If I had a new investment opportunity, they generated a 25% return, okay, with some degree of certainty. Our current portfolio currently generates NAV growth of 15% to pick a number out of the head. If you turn to a 50% discount, there's almost no way you'll get about a 10% incremental return out of doing buybacks than you would invest in an asset that gives you a 25% return. So you need that asset to generate more than 25% under that phenomena or you need to close the discount before you put money into new investments than to buy that. Clearly, if we have liquidity today, then buyback would be a very core part of how we would see returning capital to shareholders. That said, there remains lots of growth opportunities in this market. So we can close that discount. I don't think it's an either all. I think we can do both. We can return capital to shareholders, close that discount, increase the NAV per share as well as investing into new exciting investment opportunities. So to be honest. I think those are the only questions that we have. So happy to open it up to any questions on the phone.

At the moment, we don't have any questions on the audio line. [Operator Instructions]. Peter, there are no questions on the phone line. Can I hand back to you for closing comments?

Sure. Thanks. Thanks again for taking time and tend to long weekend. So we really appreciate you taking the time and apologies for the [indiscernible] conference call. And as I've always mentioned, we remain very open to having any discussions with any of the stakeholders or shareholders on the call. So feel free to e-mail or a call whatever. But broadly, I think it's what's been a tough 12 months. I think, hopefully, we've gone back to results for you to show you that the underline portfolio performance has been pretty strong, quite frankly, except for a couple of assets, which I think, hopefully, you've seen the bottom end of the negative trajectory. And hopefully, we'll start to see some better performance under those 4 assets in particular or probably less so. And I think the operating environment at the moment is certainly more positive than it was 12 months ago, albeit on. But we look forward to working with you guys. Thanks very much for you for today and the course of the last 12 months. Thanks very much.

Thank you very much, sir. Ladies and gentlemen, that concludes today's conference. Thank you for joining us. You may now disconnect your lines.