Fiducian Group Ltd (FID) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. And welcome to the 28th Annual General Meeting of Shareholders of the Fiducian Group. My name is Inderjit Singh, the Executive Chairman of the company. Today's meeting is being held at our offices at 1 York Street, Sydney and online via the Computershare platform. This allows shareholders, proxies and guests to attend the meeting in person and virtually. In addition, shareholders and proxies have the ability to ask questions and submit votes. First, of course, I'd like to introduce you the individuals that are also in attendance, your Directors, Frank Khouri, Kerry Skellern and Sam Hallab. In addition, we also have in attendance, our General Counsel and Company Secretary, Mr. Paul Gubecka, sitting there; our Group Chief Financial Officer; Rahul Guha, who is there; and our company's auditor, Mr. Andrew Reeves from KPMG. And if you have any difficult questions, I'm sure Andrew will be happy to answer them. The quorum and the meeting. So the quorum is there. It is past the appointed time of 10:00 a.m. Mr. Gubecka has advised me that there is a quorum through attendees at 1 York Street and on the Computershare platform. And so I declare the meeting, which is to be held at a reasonable time and place convenient to shareholders open. Questions. Questions Can be submitted at any time. [Operator Instructions] The Computershare platform provides guidance on how to lodge any questions. Please note that while you can submit questions from now on, I will not address them until after we have put forward the financial report and resolutions for consideration at this meeting. After which, we will address all questions together one after another. Please also note that your questions will be received by Mr. Paul Gubecka, General Counsel and Company Secretary, and may be moderated, or if we receive similar questions may be amalgamated. Due to time constraints, we may run out of time to answer all your questions. If this happens, we will answer them in due course and will post our responses on our website. The attendees. There were 1,680 shareholders registered as holding 31,477,623 shares at 10 a.m. on 17th of October 2024. The number of shareholders in attendance immediately prior to the commencement of this Annual General meeting was, I think, 20 shareholders. Now I'll explain the voting method. The procedures for voting will be carried out in the following manner: one, as disclosed in the Notice of Meeting, voting today will be conducted by a way of a poll on all items of business. Second point, as a poll is being conducted, the minutes of this meeting will record the total number of proxy votes exercisable by all proxies validly appointed, the direction of the proxy forms and the total votes in favor, total votes against and total of abstentions in accordance with Section 251AA of the Corporations Act. Three, the person entitled to vote on this poll are all shareholders, representatives and attorneys of shareholders and proxyholders who hold color admission cards or have logged into the Computershare platform. If you are eligible to vote at this meeting and attending in person, on the reverse of your color admission card is your voting paper and instructions. If you are eligible to vote at this meeting and attending virtually, a polling icon will appear within the Computershare platform. Selecting this icon will bring up a list of resolutions and present you with voting options. To cast your vote, simply select one of the options. There is no need to hit submit or the enter button as the vote is automatically recorded. You do, however, have the ability to change your vote up until the time I declare voting closed. I now declare voting open on all items of business. The voting tab will soon appear. Please submit your votes at any time. Voting will end within 2 minutes of the closure of the meeting. I will give you a warning before the closure of the meeting to remind you to cast your vote. For benefit of all shareholders, Computershare, the company's share registry received 80 proxies comprising 51.49% of the securities issued by the company and totaling 16,206,795 shares including those received electronically by 10 a.m. on the 15th of October 2024. Of those proxies, resolution 1, that the remuneration report be adopted 4,999,222 or 98.2%, plus 0.86% of open vote appointed proxies totaling 99.06% of eligible proxies cast are in favor of the motion. The Resolution 2, to elect -- re-elect Mr. Frank Khouri as Director, 14,495,539 or 89.59% plus 5.54% of open Board appointed proxies, totaling 95.13% of eligible proxies cast are in favor of the motion to re-elect Mr. Khouri. Slide 5. Resolution 3, to approve the issue of options to the Executive Chairman, that's me, Indy Singh, 2,497,549 or 57.58% plus 1.08% of open Board appointed proxies, totaling 58.66% of eligible proxies cast are in favor of the motion. All proxy votes have been cast at the discretion of the Executive Chairman, they will be voted for resolution. No proxies have been declared invalid. Is [ Robin ] okay? Notice of Meeting. The Notice of Meeting has been circulated to shareholders and sets out the purpose of the meeting being to discuss the financial report, adopt the remuneration report, re-elect Frank Khouri as a Director, issue 85,000 shares to the Executive Chairman, deal with other business in accordance with the company's constitution and the Corporations Act 2001. No notices have been received in respect of other business. Having set out the business within the Notice of Meeting, the Notice of Meeting is taken as read. Minutes of the previous shareholder meetings, copies of the minutes of the AGM of 2023 of Fiducian Group Limited were reviewed and signed at the next meeting of the Directors. Shareholders may request a copy of the minutes from the company's Secretary, Mr. Paul Gubecka, if you wish to see them. Then the financial report. The first item of notified business consideration on the financial report for the year ended 30th of June 2024. The consolidated financial report and the reports of the directors and auditor remain available on both Fiducian and ASX websites and issued to shareholders on request. Before dealing with the report, though, I would like to give a review of the progress and outlook for the group. Bob if you -- I've got these for Robin, Rahul why don't you -- these for Robin, if you want just give some sense. These are better. Antiseptic and anti-inflammatory. [indiscernible]. So I'll now show you want to have a look see how Robin is. Yes, I don't want to -- there's a second person. I think I can start. Bob can always get a copy. Dear shareholders, as Executive Chairman and on behalf of the directors, I'm pleased to present this report on the consolidated operating performance of the Fiducian Group Ltd and its controlled operating entities for the year ended 30th of June 2024. First the highlights. Compared with the previous year, net revenue increased by 11% to $60.6 million. Underlying net profit after tax, our cash generation capability grew by 17% to $17.7 million. And statutory net profit after tax, NPAT, grew by 22% to $15 million. Underlying earnings per share increased by 17% to $0.563 from $0.48 in 2023. Funds under management advice and administration, FUMAA, grew by 10% to $13.5 billion on the 30th of June 2024. Under current financial market conditions, it continues to rise. And on the 30th of September this year, FUMAA was $14.2 billion, up $700 million in the past 3 months. Last year, Fiducian was included as one of the Best Under A Billion by Forbes Asia, and we put that slide up there. Came out of the blue. We haven't received one for this year, but this year was better than last year. And they said that the selection criteria, you must generate a new revenue between $10 million and $1 billion. We publicly traded for at least 1 year and have positive income, a comprehensive performance assessment, growth in sales and profits over the past 12 months, high return on equity over the past 5 years, and they selected from their screens 200 companies from over 20,000 listed companies in the Asia Pacific region. So I think it's a positive recognition of Fiducian's activities and a testament to the hard work done by our management team. It's really up to them, and they've done a fantastic job. The Board's mandate to management to operate a stable business that aims to deliver double-digit growth over the long term based on the principles of people, profit and planet is being delivered. The balance sheet. A key feature of the company is that it continues to maintain a clean balance sheet and remains debt-free with positive working capital and a cash flow position. However, the circumstances dictate the capital raising or debt funding may be considered where suitable acquisitions or business growth opportunities present themselves. The final dividend. The Board remains prudent but is confident that the future of the business is positive and likely to continue to strengthen through organic growth and acquisitions of client bases that can benefit from the Fiducian process. As a result, a fully franked dividend of $0.211 per share has been declared for the recent half year, which will bring the total fully franked dividend declared for 2024 financial year to $0.393, an increase of 30% over the previous financial year. The full year dividend represents 70% of the underlying NPAT cash profit for the year. The final dividend was paid on the 12th of September 2024 on issued shares held on the 29th of August 2024. The on-market buyback. During the year, no shares were bought back on market, leaving 31.44 million shares on issue at year-end. Cash flow and financial highlights. Net operating cash flows increased from $14.2 million in 2023 to $19.5 million in 2024. Further, dividends of $11.4 million were paid during the period and as well, another $1 million relating to a lease principal payment. As a result, net cash and cash equivalents, increased by $7 million. 2023, the increase was $2.2 million. And cash at the year-end was therefore $26.6 million compared to $19.6 million at the end of 2023. Staff and Chairman options. In accordance with the terms and conditions of the approved Employee and Director Share Option Plan and my contract, it has been determined that 85,000 options are to be issued to the Executive Chairman with respect to the year ended 30th of June 2024, subject, of course, to shareholder approval. The options can be exercised by him, me, within 5 years on payment of $7.26 a share. Details of the method of calculation and conditions attached to the options are presented in the annual financial statements. Financial planning. During the year, Funds under Advice grew from $4.6 billion in June 2023 to $4.8 billion in June 2024. Internal training programs for financial advisers have intensified to enable them to deliver superior quality advice in a compliant manner. Consequently, client retention remains high. During this financial year, several financial advisers retired and new ones joined. The total number of financial advisers, therefore, remain steady. Fiducian expects the highest level of compliance and client service from its financial planning network. And while expensive, it is possible that we may have one of the highest supervisory management to financial adviser ratios in Australia, but we feel that is necessary. The group provided loan funding of $1.6 million to assess several franchisees to acquire financial planning practices and lift their revenue. Net inflows of $280 (sic) [ $281 ] million were received during the year. Practice Managers are focusing on helping our financial advisers lift their revenue, attract more clients and build their businesses. Our focus will remain on generating inflows through organic and inorganic growth, while further acquisitions of client bases that we believe can be quickly assimilated, continue to be negotiated. Salaried and franchised offices. Fiducian financial advice offices are now present in all states and territories of Mainland Australia. Company-owned offices now comprise over 50% of Funds under Advice We now have 38 salaried advisers. Franchised offices also comprise around 50% of our Funds under Advice. We have 42 franchised financial planners nationally. Platform Administration. Platform Administration offers portfolio wrap administration for superannuation and investment services to financial planners, and as well, Separately Managed Accounts or SMAs, as they're called, which offer investors direct access to a small number of shares and funds that are managed separately for them. Therefore, Fiducian labeled platforms for Fiducian financial advisers are now complemented by badged platforms and Auxilium, which deals only with the external independent financial adviser market. We have proven the capability of our administration system, which is comfortably coping with the different requirements of external IFAs. IFAs are individual independent financial advisers. Auxilium platforms for superannuation and non-superannuation IFA businesses are successfully competing against established players. Funds under administration for badges and Auxilium is starting to gather momentum. The first step of demonstrating the capability of FasTrack our administration system is progressing in full earnest, and so far 72 external financial advisers have registered with us to begin using Auxilium. We believe that Auxilium could become an important revenue for us in years to come. Funds under administration on our Fiducian labeled platform stood at $3.55 billion on 30th of June 2024. Overall growth in net funds under administration was driven by new inflows and market growth. Funds under administration for IFAs is around 11% of total funds under administration. Efforts are underway to build new relationships and increase net inflows from nonaligned financial planer groups in particular, through SMA administration services and Auxilium. Superannuation. The Superannuation Trustee Board established for Fiducian Superannuation Service, public offer superannuation wrap fund in March 2015, with a majority of independent directors operates professionally and with independence. The Trustee Board is functioning well and carrying out its duties diligently. The Board is supported by the Office of Superannuation Trustee. It outsources key operational processes to specialist advice providers and service providers and in particular to ensure accuracy in data reporting, it has recently engaged a Big Four accounting firm to review data that is continuously reported to the regulator, APRA. During the year, Fiducian diversified funds are converted to separately managed accounts. Now this is the rising trend in retail financial services. It gives investors the flexibility and control to alter their portfolios by themselves or with the help of their financial advisers without being restricted by benchmark-driven trustee products that were actually introduced by us in 1997. This conversion allowed us to reduce our administration fees, which are getting closer to competing with industry fund fees, and also against leading retail platforms that offer SMAs in the main. The fee reduction introduced on 1 June 2024 impacts our revenue by approximately $1 million annually, which we intend to make up through higher inflows and funds under administration over the coming year. Funds Management. Our in-house Manage-the-Manager system of investment continues to attract the majority of retail funds placed with us. Fiducian Funds have performed well over the medium to long term in their respective categories as we diversify their assets through a range of underlying fund managers to reduce risk and volatility. Information Technology. Fiducian IT development team has been busily working from both home and head office to provide system enhancements that deliver efficiency and wide-ranging functionality to FORCe financial planning system and to FasTrack our platform administration system. The improvements provide integration with our online reporting tools and give us an edge when competing with administration-related business for Auxilium and as well as scope to distribute FORCe, our financial planning software, on a stand-alone basis. I hazard a guess, but I think we're probably the only entity that has a seamless connectivity between financial planning software, platform and reporting. And that's supposedly a Holy Grail for most people, but they're using different models and different manufacturing and different systems. With human resources. At Fiducian, we have always acknowledged staff as our most important and valuable asset, and we continue to nurture and help them grow personally and into positions of responsibility as part of the Fiducian family. Management has taken a hybrid approach to working with teams splitting their working days between the office and home while continuing to discharge their duties, meet regulatory obligations and remain connected with their colleagues and clients. This is a worldwide transformation of the workplace environment, which we have accommodated. We also understand the pressures posed by cost-of-living crisis our employees are facing and have provided increases in salaries and bonuses to help them cope. Fiducian has and will always be an equal opportunity employer. Our diversity policy encourages persons of different race, gender, sexual preferences, religion, national or ethnic origin, age or disability and skills to participate and receive recognition, reward and management responsibility commensurate with their performance. Employees are from over 28 countries of origin, 22% are over 55 years of age, 46% are female with 30% of them in senior roles. The Advisers Council. The Advisers Council is drawn from our supporting financial advisers and has again made a significant contribution to the company during the past year. It continues to fulfill its role as a sounding Board for the company's management and Boards and is a valuable resource and forum to alert us on financial planning issues, FORCe enhancements and FasTrack changes that lift client care and operational efficiency. The Board of Directors and management has worked together cohesively as a team with respect and candor for each other but with a clear mutual understanding of each other's roles and responsibilities in achieving optimal performance. Mrs. Kerry Skellern, who has operational experience and is also a consultant to other company directors joined the Board last year. Her appointment was ratified at the 2023 AGM and the skills she brings assists the Board in its decisions. Now giving back to the community, which is the planet. Fiducian has continued providing support to community organizations and supporting teams linked to our financial planning network. We currently sponsor 18 amateur teams across Australia. For the last 3 years, we have supported the junior development program of coaching at the Avondale Golf Club in Sydney. While our contribution is modest, we are proud that a couple of young lady golfers qualified last year for the USLPGA, while others are representing Australia as amateurs or turning professional. Vision Beyond AUS, a charity supported by the Fiducian Group has continued its services in hospitals in India, Myanmar, Nepal and Cambodia. More than 55,901 or probably 56,000 as I speak, men, women and children who live in abject poverty have had their eyesight restored. In addition, surgical equipment has been donated to overseas hospitals. 18,000 children have been screened for eye disabilities in rural areas of Nepal. Fiducian staff voluntarily provide accounting, administration and marketing support to Vision Beyond AUS to ensure that every single dollar contributed by generous donors goes towards eliminating visual impairment in the world. On the economic and financial markets. The Australian economy grew 0.1% in the March quarter and 1.1% for the full year, basically sustained by consumption spending by households on essential items and by government on social benefits, especially Medicare and energy rebates. However, the household saving ratio declined further. And in per capita terms, which is per capita growth, the economy actually contracted for the fourth quarter in a row. High levels of immigration, shortage of housing and relatively high interest rates are making homeownership difficult for young Australians. We hear many small businesses are struggling too and could close. Clearly, the cost of living crisis is impacting ordinary Australians. Domestic interest rates remains at 4.35%. While inflation has come down from its peak of 7.8% to around 4% now, the RBA would like more evidence of further declines before a rate cut is introduced. Unfortunately, government spending is not supportive of Reserve Bank's efforts. We believe it is likely to be higher rates for longer before visible signs of a slowing economy emerge. The global economy has been growing at just under its long-term trend rate, despite inflation fighting high interest rate policies of most of the world's major central banks. As the IMF noted, while inflation trends are encouraging, we are not there yet. However, the forecast is for average inflation decline in the advanced economies. The objective is to engineer a soft landing, which is lower inflation and a slower economy, but with positive GDP growth. Most share markets -- major share markets have been strengthening since 2023. Indeed, through the first half of 2024, market movements have delivered high single-digit to double-digit increases. For example, the NASDAQ in the U.S. or the technology-led index rose 18% in the first 6 months. So across the board, client portfolios have risen in value. This year could also bring positive results for clients, assuming that the inflationary outlook improves. The risk is that interest rates do not decline as expected because inflation remains sticky. Consequently, investors may get disillusioned and sell out causing share markets to fall sharply. Research forecasts, however, we are receiving for '24-'25 suggests single- to double-digit positive earnings growth from companies represented on global share indexes. Therefore, we are approaching the coming year cautiously with a touch of optimism. Growth assets in our diversified portfolios remained marginally above benchmark, while our fixed interest exposure has been raised and is close to its benchmark. As you would note, this represents a neutral strategy as we continue to observe the decisions of central banks and global financial institutions. As always, we recommend that investors should consult a Fiducian financial adviser, to develop financial plans with the aim of achieving diversified investment strategies that over time could help investors realize their financial goals. The outlook. Consistent with our strategy over the last 28 years, our focus remains the establishment of a business with a rock-solid foundation and growth strategies to enable upscaling on existing capacity and leveraging our controlled, relatively low cost -- low fixed cost base. This strategy has benefited us in difficult and uncertain times with increasing revenues and growing profits. The Board's aim remains to build scale and deliver consistent double-digit earnings growth over the long term, and management is determined to stay committed to try and achieve this goal. On behalf of the Board, I would like to thank all participants for their individual contributions to the growth and success of Fiducian. Thank you. We kind of bring this presentation every year and doesn't want to. Now please provide your questions via the Computershare platform, and we will address them shortly. First resolution, which is the adoption of the remuneration report. The remuneration report is set out in the 2024 Annual Report on Pages 16 to 22. The vote on this resolution is advisory only and does not bind the directors of the company. However, I note that pursuant to the Corporations Act, if 25% or more votes that are cast are voted against the adoption of the remuneration report at 2 consecutive AGMs, shareholders will be required to vote at the second AGM on a resolution called a spill resolution for another meeting to be held within 90 days of the second AGM, at which all the company Directors, other than the Executive Chairman, must stand for reelection. I don't think that's the case. And the following ordinary resolution is proposed in the Notice of Meeting that the remuneration report is adopted. Please ensure that you have voted on the Computershare platform. So do I need to ask? No? Okay, it's all done. We will now move to the next item of business to elect Frank Khouri as a Director. The next resolution concerns the reelection of Mr. Frank Khouri as a Director of the company. Mr. Khouri's personal details are included in the explanatory memorandum attached to the Notice of Meeting. The following motion is to be passed as an ordinary resolution. That Mr. Frank Khouri, being a Director, retiring by rotation and being eligible for reelection, is reelected as a Director of the company. Again, I remind you to please ensure that you have voted on the Computershare platform. [Voting]

Now the Executive Chairman share options, which are mine. The next resolution concerns the shareholder approval for the issue to the Executive Chairman of 85,000 share options. The basis for the issue of the options was outlined in the explanatory memorandum touched to the Notice of Meeting. The motion which is to be passed as an ordinary resolution is, that approval is given pursuant to ASX Listing Rule 10.14 and for all other purposes to grant Mr. Indy Singh 85,000 share options to acquire ordinary shares and Fiducian in accordance with the terms of his employment agreement at an exercise price of $7.26 per share and to issue shares subscribed for pursuant to the options. Again, I remind you to please ensure that you've voted on the Computershare platform. [Voting]

Other general business. No notices have been received to deal with other business in accordance with the company's constitution and the Corporations Act 2001. Now I will come to questions. As there is no other business, we will turn to any questions that shareholders may wish to ask the company. As part of our Notice of Meeting, we will ask shareholders present questions Computershare for our response today. Computershare have confirmed that there was one question received by them prior to this meeting. Mr. Gubecka, could you sort of read out the question?

Yes. The question came from shareholder Inman [indiscernible] and he has asked, may I ask [indiscernible] does Fiducian have a succession plan?

Now there's a long and a short answer. But I think I've been asked this question so many times. I remember when we were just starting up. And there was me, Alan Dan, who has come there, the shareholder, and one other, and it was getting close to 8:00, and I was washing up the cups and saucers. And I was asked this question, what's your succession plan on 3 of us. Maybe a dishwasher will be a good idea. But look, I think the real question is, will the business continue as a going concern in the event of demand risk. And the short answer is, yes, it certainly can. So let me explain how we structure it. There are 4 individuals, Rahul, who heads our General of Financial Services, which provides all the services to our business, IT, marketing, HR, finance, admin, stuff like that, big job. There's Robby Southall, who runs financial planning, employs about 100-plus people. Conrad Burge, Conrad [indiscernible] who is the Chairman of Fiducian Funds and Investments. And Jai Singh, who looks after our acquisitions, mergers and is -- basically it was his idea to get going with Auxilium because stock brokers are saying that you're going to be valued low compared to your competitors who are disruptors. And as much of that role, and we're doing the same thing which is receiving people's money, administering and reporting it, why are they suddenly so expensive and so let's disrupt the disruptors. So we started Auxilium. And then there's also Paul, who's our General Counsel, and he keeps us honest and tells us if there's any compliance issues or anything. So these are the -- this is the executive leadership team with me, and we meet regularly and they report back to me. So drill down a bit. Financial Planning, which is the enabler of money coming through. The Chairman of that company is Robby Southall. Robby has his own Board. They have their own Board meetings. He has his own general managers, his own managers, practice managers, whatever. And their minutes are prepared, which go all the way up to the main Board. The same way, Fiducian Services, which is Rahul's company, he manages it. He's Chairman of that company, and his minutes come up to the Board as well, and he has his own Board. And Conrad, who's Chairman of Fiducian Investments. He has his Board and the Investment Committee and independence there. And he prepares his minutes and they come up to the Board as well. Now continuity, whatever happens, whether to me because, yes, there is a key man risk always right from the lowest link where there's a staff who's putting data into the system, if he goes, yes, there's a risk. There's all the way up to all managers, me, everyone. There's always a risk, if you don't have a business. But will the business continue? Yes, Robby, will keep running his financial planning business. Conrad will keep running the investment business and delivering the returns that we expect, lower risk, above average returns, and Rahul will continue running the services business, providing IT, HR, marketing, whatever. Now it doesn't stop there. Why do we have 3 separate entities and 3 separate minutes? Because while the Head of IT might report back to Rahul at the Board meeting of what he's doing, what's happening, what the development is, it must also be reported to, for example, Financial Planning because they're going to use that system. And they must know and report back whether there's bugs, whether there's something not right, whether they need something. And the reason for that is that while you can never provide complete transparency as much as possible transparency of the business drills down to the Board. So they can see whatever is happening in financial planning through their minutes or whatever is happening in services and how the interaction and integration is affecting the business. So they've got that thumb on the pulse. Now if it comes to me, I don't intend to get hit by a bus. But look, as far as I'm concerned and [ David can vouch ] for this, there's only 1 person that's indispensable and he is in what we call heaven. We're all passengers. We're there for a ride. We're there for time, and we move. The business continues, the world continues in a better phase. And even the large companies have had to recruit from overseas or outside or whatever. Certainly, I'm not indispensable. I'm just like anyone else, like any of the executives. And so if push comes to shove, the Board takes over. The Board then seeks internal management, people have put their hand up and say I want to run it. And there's insurance where they've got a fair bit of door to go externally and select from anywhere in the world. And so this is a listed company. It's not a private personal system. It will continue. But what they know and with this process, the responsibility. And those of you who are normal MBA students and whatever will know that the most important and the crucial responsibility of a Board is to make sure that there is someone who is in leadership position to continue with the business. And remember that, that continuation and the culture that's been developed here, starting with Bob, who was my greatest mentor, David who helped me start, his ethics, quality, person's knowledge. Yes, I know IT, I was an engineer. I know financial planning. I'm a CFP, all good investment manager. I manage it all myself. And as I said, wash the cups and saucers at the start, but there's over 200-odd people employed. There's 450 or 460 people whose livelihoods depend on Fiducian. That's my risk. That's my problem. That's what I dream about and worry about, their families, their kids, their livelihoods. And they will work it out. That's the big responsibility of how this business continues going forward. As a listed company, that's how it should be. Now they know my attitude, they know my culture, they know our culture. And you can have, as we've discussed, people who run companies and we all shareholders would know large and small financial services businesses where you've got shareholders' money. Brokers love us to borrow money, and you can start buying what you like. Whose money is it? And suddenly, you find they bought for $2 billion to buy this and $3 billion to buy that, and the share price has fallen 70%. How smart is that? And then there are others who are running businesses, icons, companies that have been going for hundreds of years. And the easiest thing for me or anyone is to sell. Sell it. So easy, by someone. Well, how come the guy who's buying it, believe they can make money from it while we can't? It make sense. So the person who will be here and who'll run over must have knowledge of the business, understand it, have a concept to grow the business, to grow it, to make sure people are employed that the stakeholders and the staff are secured. And that's the vision. That's the real thing that we need for a person who's going to run this business. Don't go overboard, keep your feet on the ground. We're run by shareholders' money. So if we're going to buy something, the first thing we look at, to Rahul's Group and then Jai brings someone, I remember my father who was a sharp businessmen in India. He told me once, he said, "son, it's easy to buy an elephant. When you're going to feed the damn thing and make money out of it, you got a problem. And come to Australia, what if he dies on your doorstep, who's going to clean all that," so it's -- you got to be very cautious and very careful. And if we make an acquisition, it must show that there is a comparative or higher return on the profit. The revenue can go up, but the profit must go faster. These are the things that the Board's big responsibilities going forward. I hope I don't get this question again. But I've answered it almost every year. Any others?

There's also three questions that we've received on the platform. First one is one for Frank. So could Mr. Khouri, please talk to the meeting to outline his thoughts on the main opportunities and risks facing Fiducian as well as how he intends to help the company pursue opportunities and mitigate risks. That's for Frank.

On Frank.

That's too frankly.

Too frank, yes. Well, are you going to answer it? Or do you want me to? Yes, you can go for it if you like.

I will certainly support you, but how do you lead in and if you leave anything out I'll fill in the gap.

Which is normal. Okay. So risks -- was the question risks?

Pursue opportunities and mitigate risks.

Look, with opportunities, it's important that, as I said, keep your feet on the ground and stick to your knitting, stick to your knitting. What you're good at, grow that. We're good at administration. We are on a great team under Rahul, expand the administration, which we've done through Auxilium. We're good at financial planning, expand that, get more franchises, make acquisitions of advisers and client bases, and the third point, anything else?

That was only the question.

Okay. So there's an opportunity. Now people say, why aren't you in private equity? Yes, well, if some -- if the opportunity presents itself, yes, we'll do it. But I think the focus is quite clear. We built, as I said at the start of my talk, a solid foundation, platform, admin, systems, it works. They work. I've had people come from outside and touch wood so far everything stays. I said, we can't understand how your report comes in from your admin team and Rahul, the Board that there was -- everything was done within the core -- the standard service level agreement. How is it possible? Well, I don't know what is happening. We have our own IT team, and we know what's needed when APRA or ASIC said or ATO says you will report this way, we're amongst the first. We don't rely on anyone. We did in the past as that wasn't good enough. So we had to do ourselves. Well, I guess [indiscernible].

I could just say as far as my contribution to the Board, will be continuing what I've done for the last 17 years, I guess, is bring a perspective from a financial planners point of view as I've held a Fiducian franchise since the franchises were issued back in 2001, I think it was, and the -- with the client experience that comes with that. So I think from a Board point of view, I think it's valuable for the Board, particularly with a grassroots view of what's happening out in one of our most important core businesses, which is the financial planning area. So I'll continue to do that. I've also had a long career in accounting, public accounting, auditing, advising small business. So I guess, that's what I can contribute going forward, I think, to the Board and want I have, I believe, contributed up until now.

And fortunately, now we've got 1 -- 2 non-accountants on the board. Otherwise, before that, we had all accountants and the amount of mayhem when every time the auditor came up with the accounts and whatever and every [indiscernible] and why is this $0.03 more and that was $0.01 less, but it's calmed down a bit, and Frank's invaluable from that respect. And he knows superannuation. He's been on the Superannuation Trustee Board. He knows planning, he knows accounts, and it's a great contribution to the business.

Now I've got two more questions. This is from the same shareholder, Mr. Claude Walker. He asks are you feeling more positive or circumspect or the same about Auxilium compared to the last time you updated us in August?

Yes, I'm certainly feeling more positive. They've now got about 70-something advisers signed up. They had started placing business, and then we actually put a pause on it. We just wanted to make sure, given rumblings at ASIC and APRA of what's going on and the industry funds sort of [ bleating ] to the minister, people are taking their money out. And the industry funds have a serious problem now because our fees have come down. They are losing a lot of money, which they forgot that their membership also gets old. And they have to start paying pensions out too in instead the early days when they just kept taking money in. And there's a lot of money going out because people have been put in there with the unions and other stock through the union. They're sitting in the fund with no one to talk to, but people want to speak to someone. They want advice. They want to know what's going on. Why am I there? What's happening? What do I do about my kids? What's happening to my -- do I need a testament to transfer my handicap child? Do I have to fix up the binding debt nomination? Do I change the asset allocation because I want to get it there and I'm getting here? Do I pay off my mortgage? So heaps of things. There are 100-odd strategies you can talk about, but we're trying to target that cohort as well, young people or younger, who need to talk to someone, who need that advice. And pensioners who are getting out, they don't even know what they should do. They're just told you take a pension. Well, they don't realize there's something called as sequencing risk, where you put your money in growth assets as you're told and then the market tanks and you take the door, now you can't even meet your eventual requirements unless you structure it differently the way a financial adviser would that you never crystallize a loss. So I think that settles it.

There's one final question that I have online now. It's from Jeff Rogers. He has a question in relation to India, investments in India. Many of -- how is solution managing portfolios, which invested in Indian listed and unlisted equities? Did Fiducian use external advisers or information sources? And are you able to comment briefly on any issuers represented in the portfolio that illustrate the returns achieved and prospects for the long term?

Okay. Now many people think that I started the India fund because I'm of Indian origin. That's not the reason. The reason was that India opened up its market 16 years behind China, and the opportunity was phenomenal to get in at a ground level grassroots. The problem with people think as India is easy. There's 325 dialects, 22 official languages with their own script. I can only read 2 -- 3, sorry. And it is a huge mismatch of people, attitudes. And you think you can run a fund with someone sitting in Hong Kong, and saying I'm investing in India when he can't even speak the lingo. And we know we get in stores. We get people come to talk to us. And we tell them, what are we going to tell them. And there are some in stores who come and we tell them what we need them to know, but the same thing happens there. We got 2,000-or-something securities. They got 7,000 and growing every day. We have 4 managers -- 4 different managers. One to manage just the top 20s. So we have an anchor. We have one which only manages small and mid-cap. And we have 2 others who do the lot. Now when the election comes, Conrad gets his feedback and he says, whoops, Mr. Modi looks like he's losing, let's build up cash. Because last time when Mr. Modi won, the market jumped 26% in 15 minutes. So you got to be across the board. And we own all the securities. To be honest, I don't trust any one in India, anyone who's there. I've been there, done it. I know what happens. We inform, the fund managers inform us what securities they want to buy. We inform our custodian, sub-custodian, which is Citibank. They talk to the brokers, pick up the securities and hold them. No one touches a cent. No one gets their hands on anything. And so we've got 4 different fund managers, different styles, different processes, different number of securities. And I think what's it done, Conrad, 16 a year for the last 15 years or something?

It's 12.

And last 10 years was, I think, 15 or 16. Well, you know the rule of 72. Anyone who came 10 years ago, would have quadrupled their money by now. Then the technology fund you would have made it 8x by now. So these are specialist funds we've introduced for our investors. And these are things that will really help people who are in large funds without an adviser who need to invest in growth assets. We've got 35-year runway, 40 years to go before they retire. They need to take risk. They need to invest in good quality assets which are unlike with us, diversified, fully diversified with low average risk, above average returns, very rare, but Conrad's team does it. Anything else or I can keep rambling on?

Not online, but you may want to ask if anyone who has questions.

[indiscernible] shareholder, update us on the regulator and the last time we talk about this interest and your views on that still an issue or still...

Well, look, it's a very strange thing. We couldn't understand it. They put out a condition on our superannuation license. And I've said here what we've done. What happened is they had something called D2A first direct to APRA. And everything was going fine. Well, they came out with this table and they said, you have to now complete this table with all your returns going back a period. And there was no glossary. You didn't which column what has to be presented. There was a time, David, in the past, when I went up and met Tom Karp in Canberra and they said Indy tell us how we can help you. Today, you don't want to go any other regulator. So our own analysis talking to our fund managers one column, which said comparator, which means you compare and the other column was returns. Well, it was the other way around. So the person from the regulator phones our people and says, don't worry man, half the bloody industry has got it wrong. Half the industry has got it wrong. The industry funds, us, small, everyone. But when I found out that we had got it wrong, I immediately engaged KPMG, the internal audit, and I said, I just don't want you to see what happened incorrectly in filling these 2 columns. Now before that, we got a message in about December to come back to the regulator on the 12th or something of December by January with a top 4 firm, what happened? How did it go wrong? Now we were just one. No one else was asked as we understand. And so we got, I think at that time, KPMG was on holiday, PwC was on holiday, everyone. So we got BDO, I think. They said we'll do it over December. We got a few people. And they came back and said, nothing wrong. They just got the columns wrong. Well, somehow that was a good enough. So we had to get back to KPMG. We said now, I said, don't just do the columns, do a full review of every process, I don't care what it costs. Every process I want to know. They started the review. A week before they said, we'll give you our final response. We had talked to Ernst & Young as well to do a review. We pulled out all the stops. 1 week before, the result was coming out, we talked to them. I said, look, we've done more than you have asked us. So they gave us this license condition. You've got to do a review. How [indiscernible] is that? Do a review, and we've already done it not just one, but more way beyond what they even asked. And the results, Akash, is there from KPMG, same answer. Fix some of your documents. There's nothing really wrong, and we had already appointed Ernst & Young to check every document that now goes to the regulator. Well, that's the world we live in. It's ridiculous. When you know the result is coming in a week, you know the previous person doing a research and analysis says nothing wrong, but you still want to prove a point to the industry or something. And no one was affected. Not one member has been impacted. Not one account has been impacted. It's just a report to regulator. So now we got Ernst & Young checking, and we got KPMG reviewing. As I said, just make sure you have a third one, if you'd like get that one too, but it's not affecting us.

That suggests that you're in the targets of the regulator?

We all are. We all are. If you read the stuff they're going after, Cbus. They're going after Cbus taking them to court, who fights the unions, small guys, big, everyone, when this came out, people wrote to me from [ Pendal BT ] and there's another fund said, Indy we've been through it, don't worry. I was just -- a good question, but it's not affecting us in any way. Peter anything? There's a glow coming from the corner?

[indiscernible] I'll comment later on another issue.

Anyone else?

No more questions.

You'd like to comment?

It's on the allocation of options. I just want to apologize. Peter Murray from London City Equities. We've been very busy, and we didn't put proxies [indiscernible]. I noticed those votes were just terrible, for or against your options. We speak for probably 2.2 million shares. So when you look at those numbers, please add those on. We'll be supporting.

Thank you Well, you know how it happens. A lot of the in-stores particularly the ones overseas, we got German, American, U.K. and some of the in stores, yes, they just go to some company. I don't know if you probably know. They said, what do we do and they said, don't vote for the option, say no., So they just say no. when I talk to them afterwards, said, no, we don't want to say no but these guys told us so we said no. Well, anyway. It's cleared anyway and thank you. You did think it was [ 100 -- 1 ] million options on the phone, you told me and I said 1 million, I can't get anywhere. Maximum, I think they've locked me in at 100,000. And to get 1 million, I'll have to have a profit increase of $10 million or something like that.

The allocation of shares low. The options are lower than they were 20 years ago.

That's all I can get, I think, that is the maximum. I have to pay for them. There's no free lunches here.

Well, I'm the retired Director from last year.

Not director, he was Chairman for 20 years.

So I think and I just want to say congratulations to the Board. First of all, to you Indy, for a great year. I miss you entirely being in those meetings because they're so fulfilling. And this is a company that is worthwhile being part of. It's one that I've enjoyed for all that time, but the Board that you have here are just excellent doing the job. The management team that is here are just fantastic as well. They all know their job. They're doing well. And I just have the privilege of going to the advisers meeting in Kingscliff this year, 200-odd people up there and the advisers of this group are outstanding as well. So you're talking about a team that is right across Australia, right through and every part of it is known by the Board. It's a wonderful company to be part of. Congratulations to you all on wonderful result this last year. Hopefully, this coming year will be even better. Thank you.

Thank you, Bob. You've always been good to us. And I might just add the Board meetings do end a little sooner than before. Well, nothing else. Then we have to give notice for...

Just the last...

Okay. There being no further questions, that concludes the business of the meeting. A member of Computershare will now collect any voting cards in the room. Please ensure you print your name where indicated and signed the voting paper. When you have finished filling in your voting paper, please lodge it in a ballot box to ensure your votes are counted. I again remind you to ensure that you have voted on the Computershare platform and voting will end at the end of 2 minutes following the closure of the meeting. The outcome of the resolutions will be lodged with the ASX as soon as practicable after the closure of voting. Thank you all for your attendance and confidence in Fiducian. We really do appreciate it. The meeting is now closed at?

11:13.

11:13 a.m. Thank you very much.