Horizon Oil Limited (HZN) Earnings Call Transcript & Summary

Well, good morning, ladies and gentlemen. My name is Mike Harding, and I'm the Chair of Horizon Oil Limited. Before beginning the meeting, we acknowledge the traditional owners of the country on which we meet today, the Gadigal people of the Eora Nation. We pay our respects to the elders past, present and emerging. I would like to welcome you officially on our Annual General Meeting for 2023. I would also like to extend a welcome to those members who are joining by the webcast. Based on the number of voting members in attendance, I declare a quorum for this meeting. But before I commence today's proceedings, I'd like to draw your attention to the safety slide. Should you hear an alarm, instructors will be broadcast by the building wardens regarding what action to take. If you are required to evacuate, please do not use lifts. Evacuation point is located on the forecourt of the Barangaroo Tower 3 as indicated on the map on the slide. I would now like to introduce my fellow directors. On my far left is Greg Bittar, Bruce Clement, and your Chief Executive Officer, Richard Beament. On my right is Nigel Burgess, Sandra Birkensleigh and also joining us our Company Secretary, Vas Margiankakos. I note that [ Marko Croft ], representing our auditors, PwC, is available today to answer questions on the auditor report later in the meeting. Before beginning the formal business of the meeting, I would like to ask Vas our Secretary to outline today's procedures and protocols.

Thank you, Mike. All resolutions will be decided by way of a poll at the end of the meeting. The meeting will consider the items of business outlined in the notice of meeting sent to all shareholders on 20th of October 2023. There will be opportunities for shareholders to ask questions and will be confined to the formal business of the meeting. Only those persons holding a yellow or blue card are eligible to ask questions. Daniel Moses of Computershare has been appointed as the returning officer. Following confirmation by Computershare, final proxy and voting results will be released to the ASX and the company's website later today. I'll now hand back to the Chair.

Many thanks, Vas. As may we get [ holders ], who can't stay for all the meeting, I now declare voting open on all items. Any undirected proxies in my favor as Chairman will be voted in favor of the relevant resolution. The meeting will consider the items of business outlined in the notice of the meeting sent to all shareholders on the 20th of October. I would like to start the meeting with my formal address. This will be followed by Richard's presentation. There will be an opportunity to ask questions on the presentation and then we'll proceed to the formal part of the meeting. Ladies and gentlemen, 2023 was again another excellent year for Horizon. We achieved a very strong financial result which allowed us to continue to provide a strong return to shareholders. The final dividend for 2023 of AUD 0.02 per share together with the interim dividend combine to AUD 0.035 per share for distribution for the year. Approximately AUD 58 million -- AUD 56 million combined with previous distributions over the past 3 years, this is a total return to shareholders of approximately AUD 150 million. Further, the financial health of Horizon has never been stronger. We are debt-free for the first time since 2011, and we're setting aside funds for the future decommissioning of Maari. Our assets in China, New Zealand are high quality, and our aim is to continue to maximize production and cash flow through workovers, infill drilling and other production enhancing initiatives. As a result of these initiatives, we've recorded record production, revenue and profitability for the financial year, underpinned by the strong performance of the Group's Block 22/12 and assets in China. Revenue increased by 41% to USD 52.1 million (sic) [ USD 152.1 million ] driven by a 44% increase in production, which delivered net sales volume of approximately 1.8 billion barrels. Our cash operating costs continue to be kept below $20 a barrel ensuring continued strong free cash flow, along with a strong oil price that delivered an excellent result for 2023. The financial result was achieved whilst maintaining a strong safety and environmental record with a combined focus on ESG matters. All our employees, consultants and the Board are involved with the various components that comprise sustainability, ensuring that our approach is fit for purpose and right for the balance between what the community expectations are and what shareholders expect to ensure a smooth global energy transition. Today 2 of my fellow directors, Nigel Burgess and Greg Bittar are seeking reelection. Both have proved valuable contributions to the company and the Board fully endorses their reelection today. Looking to the future, we will continue to work to maximize production and value from our producing assets and continue to actively pursue infill drilling wells and other production enhancing initiatives in our producing assets, which provide excellent value and we will continue to review our cash position regularly to consider further shareholder distributions while always keeping an eye out for suitable growth options. Our CEO, Richard Beament, will say more about Horizon's performance shortly. He'll update you on the company's strategy. And on behalf of the Board, I would like congratulate Richard and the team for their achievements in 2023. Finally, thank you to our shareholders for your valuable support during the year. I will now hand over to Richard to present the CEO's report.

Thanks, Mike. I'd like to welcome you all here to the AGM. And as Mike mentioned, I'd like to take a few minutes just to take you through an update on the company, the strategy, highlights for the year and most importantly, the operational activity for each of our assets. So I'll start by just putting up the mandatory disclaimer, the disclosure statement, which I encourage you to read. Please note that all references are to U.S. dollars in the presentation unless otherwise mentioned. So as Mike mentioned, the last 12 months has been a very, very strong year for Horizon and its investors, and we achieved a total shareholder return of around about 40% for the year. And importantly, with that, greater than 20% dividend yield. As Mike alluded to, we've now sustained a distribution yield of over 20% for 3 consecutive years with over AUD 150 million returned to shareholders. Importantly, this has been achieved while still investing in production growth. which has led to that record production, record revenue and earnings achieved in the last financial year. Horizon is a company, which is generating strong cash flows from its assets, continuing to develop its portfolio and importantly, returning surplus cash to shareholders. Now just a reminder on the strategy, it's pretty simple. We aim to maximize free cash flow from our assets. We are focused on shareholder returns and continuing to pay those significant distributions, and we'll continue to invest in production growth focused in and around our existing assets whilst always keeping an eye out for exceptional new business opportunities. And importantly, we're delivering on that strategy. With strong cash flow generation through the last financial year, delivering EBITDAX of over USD 103 million and our ability to generate that strong cash flow is underpinned by that very, very low cash operating cost, which is under $20 a barrel. As mentioned, the strong cash flow has allowed us to continue to prioritize distributions with both an interim and final dividend of AUD 0.035 per share, which was -- which combined to a total of about AUD 56 million. And our capacity to generate such substantial returns which is due to that robust cash flow underpinned by the low-production costs in the assets, but it's also the strategic investments we've made. So in FY '23 or over the last 18 months, we invested about USD 30 million really focused on a satellite field development in Block 22/12 12-8 East field. The development costs were recouped within about 12 months and saw production growth in the asset hit record levels of over 20,000 barrels a day gross, almost doubling production from earlier in 2022. It drove a material reserves upgrade and really drove the growth in the company over the last 12 to 18 months. Our pipeline of opportunities for further infill drilling is considerable, and our focus is on continuing to unlock that potential as we go out into the future, a topic which I'll cover a bit more later. Maari is also a very valuable asset and has incremental high-value opportunities. But probably the most accretive project is through life extension and extending out the field for a couple of years, which is a core focus of the venture. And while it's not our primary focus, we continue to look for exceptional new business opportunities, which might complement the existing portfolio with a view to enhancing shareholder returns. And Mike has already touched on a number of the recent financial highlights, so I won't go through them all. But just a couple of ones, which I'd point out, which haven't been mentioned. The combined daily production rate in FY '23 was an average of over 5,000 barrels of oil per day, an increase of some 44% and a record for the company. We've had approximately 55% 2P reserves replacement, and we continue those substantial distributions, which I mentioned. On ESG, despite the elevated activity levels, we had a very strong safety record, significantly better than industry benchmarks. And specifically on climate change, having previously declared our ambition to be net zero by 2050, we made a modest investment of seed capital in a carbon removal credit development called Nobrac Limited. And we've recently taken receipt of a pilot pyrolysis plant in order to produce the first biochar from the project and move towards carbon removal credit registration. So just a word on the share price. This is a snapshot of the share price on the right-hand side of the slide as you look at it. You've got Horizon share price in the orange, the oil price in the green and the ASX Energy Index in the blue. Importantly, you can see the linkage with oil price. [Technical Difficulty].

Ladies and gentlemen, we have temporarily lost connection with the speaker line. Please continue to hold, and the conference will resume shortly.

So can you now -- hear us now?

Please go ahead.

Okay. So as I was saying, we've got the share price chart there. And the real takeaway is that positive divergence away from both the oil price and indeed the energy index that you see from the middle of 2022, and that was really driven by that successful commissioning of the 12-8 East development with a reserves upgrade and obviously, the continued distribution stream. We've also annotated onto the slide where we paid dividends in the period with these there. You see the -- you can see there was some reasonable volatility in the share price when we made those distributions, and that's not unexpected given the substantial nature of the returns we made. But it's that positive divergence away from the oil price, which is really the significant value that we've been able to add over and above what's been a period of continued strong oil prices. And we expect oil prices to continue to be -- to remain fairly elevated given that significant underinvestment that we've seen in new developments across the globe. Just moving on to an update on the assets themselves, and I'll start with Block 22/12, really the jewel in the crown for Horizon. This has been a standout year for the asset with the recent addition of the 12-8 East field development, which came on stream in April last year. FY '23 was a period of significant activity in the block, commencing with a 5-well workover program, which was followed by a number of wells drilled in the legacy fields and then 4 wells drilled at 12-8 East. The result of this activity was a dramatic boost of production to over 20,000 barrels a day gross in December last year, which represented an almost doubling of production rates from earlier in the year. The additional production took the share of Block 22/12 cash flow to around about 80% of the company's cash flow. And that was really aided by the very low operating costs, which were less than $12 a barrel. Now whilst we do expect production rates to naturally decline. Our objective is to continue to develop the material pipeline of infill wells and water handling upgrade activities in the block in order to sustain production rates at around the long-term average of that 8,000 to 10,000 barrels a day we've achieved over the last decade. I was delighted to be able to travel to China earlier in the year. And with this first hand, the success we've had at 12-8E, we managed to get offshore. But most importantly, my key takeaway was the joint venture is very well aligned in looking to further extract value from this asset and continue to pursue those infill drilling initiatives I mentioned. And probably most importantly, the relationship with CNOOC and the other joint venture partners incredibly strong. Now Block 22/12 has a large portfolio opportunities, which can add reserves and add value. I have depicted them largely on this slide. All the little dots on that slide represents live opportunities, which we're continuing to mature as a venture. And the immediate focus is on looking at an infill drilling program in the next calendar year, targeting somewhere between 2 and 5 wells, most likely at the 6-12 platform and the 12-8 East platform. And then hopefully, we'll look towards the subsequent phase of drilling, particularly around the 12-8 East platform over the coming years. This one's probably my favorite slide. We've got the history of the asset here, a history of production and our view of its future. And you can see there just to sort of help you understand it in the dark green on the right-hand side, you've got the -- our view of the production future, largely underpinned by our 2P reserves. The light green is the production history over the last decade. And the dark -- and the blue, the blue is the indicative future activities which are representative of all of those infill well opportunities and water handling upgrades, which we are looking to exploit. There's also there a dotted orange line, which represents essentially the original forecast production from this field at project sanction. So you can see the tremendous success we've had in infill drilling over the last decade in order to sustain production rates. And that's our objective to keep that continuing. You can also see the dramatic boost to production last year with that spike in the green up to 20,000 barrels a day, when 12-8 East came on to production. In terms of the indicative future activities, I would stress that they are indicative, but certainly, they are our focus. And in order to unlock that potential, we expect to spend around about $10 million to $15 million per annum over the next 3 to 5 years in order to unlock that value. Now on to our other asset, Maari. Maari continues to be an important asset for the company and generates about 20% of our cash flow. We had some reasonably good success with workover operations throughout the year and that led to production being reinstated back to about 5,000 barrels a day, which is where it remains today. We recently have been focused on continuing workover activities, and we finished the workover of the MR2a water injection well recently, and we're currently working over the MR6a well, which is targeted at reinstating production from Maari Mangahewa reservoir, but also targeting some oil behind pipe in the Matapo Sandstone. Hopefully, that well comes online over the next couple of months, and we see a further boost to production. So with sustained production efforts at Maari, over the next 12 months, we expect production will remain robust, and that's given us the confidence to really push ahead with looking to a life extension on the asset. We were encouraged by a recent certification of the FPSO, which takes the vessel out another 5 years, out beyond the permit expiry date. And that, combined with the sustained production we're seeing from the field, has given us that strong level of confidence right across the venture in order to pursue the life extension. And I would add that with the change of government there in New Zealand, that's probably only a positive in terms of aiding the life extension efforts. We'll just move on to the next slide. Again, we've got the production forecast or our view of the future for Maari and a bit of history. What you can see from this slide is quite a bit different to the China slide and the production is quite flat with a very modest decline. And so we don't need that substantial investment in infill drilling in order to sustain production rates. The field is very well supported by water injection. And really, we see most of the values just in small incremental workover activity in order to sustain production rates. We've got in there some light blue indicative future activities, but most of that requires quite expensive drilling and a substantial extension to the permit to be viable. So it's not something we're particularly focused on. But really, the value that we are focused on is a short life extension, which is largely depicted by the dark blue there at the right-hand side, extending the field out 3 to 5 years. And you can see on there, it would add roughly 1 million barrels and then add substantial value at fairly minimal cost. And so just on to the plan for the next 12 months and the key operational activities. I've touched on a number of this already. And again, I would just highlight these are indicative, subject to joint venture approvals and the like. But at Block 22/12, we've got between 2 and 5 infill well opportunities which are being progressed, and we expect that they will be further firmed up over the coming months. Upgrades to water handling capacity of Block 22/12 remain a constant priority, and we're working well with the operator to pursue that. And at 12-8 East as part of the infill drilling program, but part of it, we're looking at is some sidetracks to the -- to a couple of the existing wells in order to aid with a more comprehensive drilling program, which has been planned in future years. And at Maari, as I mentioned, we've got that 1 immediate workover priority with the MR6a well, which is currently underway and the focus on life extension, which we hope to submit that application sometime in the new year. So let me conclude by summarizing our strategy and the way we expect to deliver on it during 2024. Firstly, to maximize free cash flow generation. We commenced FY '24 very well with strong production aided by the continued high oil price. And whilst we foreshadowed, the production rates would naturally decline, particularly at Block 22/12, this decline in production coincides with a return to more normal levels of capital expenditure such that, subject to oil prices and, of course, production we see free cash flow generation being substantially maintained. Secondly, to make further distributions to shareholders. We remain determined to deliver value to shareholders having returned over AUD 150 million over the past 3 years. Further distributions remain a priority, always delicately balancing returns with growth and the need to adequately provision and set money aside for Maari decommissioning. And thirdly, to continue investing in production growth. Our priority is to invest in production growth within our existing portfolio in order to unlock shareholder value with further infill drilling and workovers at Maari as the priority. These organic growth opportunities continue to be our primary focus for growth as they offer significant incremental returns with very rapid payback periods. But nevertheless, we keep an eye out for opportunistic inorganic growth opportunities, which could further enhance value. So they do need to have strong investment metrics and ideally the potential to enhance our -- making further distributions. Now before I hand back to Mike, I'd just like to make special mention of the amazing team with whom it's a privilege to work with every day. And to that end, I'd just like to thank the management team, Gavin, Kyle and he's not here and Vas for all their tremendous efforts, along with our talented team of staff and consultants whom without the results we've been able to achieve wouldn't have been possible. Thank you.

Thanks Richard. I'd now like to give everybody an opportunity for questions on the presentation, and there will be an opportunity to ask questions on the formal business later. I'll endeavor to get everybody a good go at asking questions. So I open it up -- the floor now.

Mike, we saw the production growth in China. [indiscernible] Is there hope that the potential to [ kick up ] the license [indiscernible]. I think -- I know that the contract, seeing as how you negotiated it but sort of from that perspective of China. If you want [ to keep ] investing in this new production might be in the interest to extend the first license that...

Richard, you were up there?

Yes, I could probably give it a bit. So just all -- understand, and we've got 2 sort of relevant dates. We've got 2030 -- April 2030 was in the end of the [ Australian ] contract and August 2028, which is the end of the production period for the legacy fields that came on in 2013. So the question really goes to what's our potential to be able to extend the license first of all, for that initial production period out beyond 2028 as you alluded to the end of PSC and not beyond. So it's challenging. So it's as challenging in China to get those sorts of extensions, but all -- a scenario where you invest significant amounts of capital later in the service life and it's recognized by [ seeing ] that in order to get an economic return that you will need an extension. I think probably a couple of things to point out is most of the incremental infill well opportunities are very much in 12-8 East. There are still smatterings across the other -- the other legacy fields, and we are continuing to focus on probably the legacy fields first to make sure that's not an issue. But the infill wells in 12-8 East, what you can see through that production chart in 12-8E wells decline very rapidly. They come on very strong, and they pay back within -- depending on oil price, 3, 6, 9 months and very, very rapidly. So you can drill economically all the way up towards the permits expiring and for 12-8 East, it doesn't have that 2028 [ state ] to worry about because it came on in 2022. So we can drill 12-8E well all way out through the 2030. And so we've tried to sort of show that with this little bit of a slither here playing out. But whether we drill 12-8 East wells here or even later, probably doesn't make a huge, huge impact. But we do recognize there are potentially some water flow opportunities and some other things which might need more significant amounts of capital and if they do mature, then certainly, that's the sort of discussion we expect to happen seeing if get a [ trial ] into push those -- we push that down to the out. I think to get the PSC beyond 2030 is very challenging and then really to be able to push the production periods out all the way to the end of the PSC is very much going to be a function of what level of capital spend we're willing to commit to and provide to all of those projects.

I think, [ Brent ]. From listening to Richard, I remember in Board meetings that CNOOC tend to like is -- now I know it's China, and they can not like us very quickly, but always posing us with options to look at with ROC Oil because they like the way we behave. So we're not in the bad books, just the opposite.

No, I accept that. I think there's been a feature of the relationship that goes back to 2001 with the CNOOC, ROC and [indiscernible]. And the second question, if I may, in relation to Maari, again, production curve -- synergy highlighted [indiscernible] beyond the current date. I know it's the permit -- the license agreement actually -- makes the [indiscernible]. Now that brings me to [indiscernible]. I think to [indiscernible] New Zealand assets -- and I wonder whether organic growth option [indiscernible] interest by that divestment, obviously provided, it didn't mean increasing our exposure to the [indiscernible] cost would actively -- obviously structured like that. But so what about status of the -- so you might be -- my second question was that Mike mentioned in his address that -- making a provision for the -- there's been a lot of talk about that -- New Zealand government, [ Jac Ardern ] is now gone, so you got a new government. The requirements were pretty vague. I think that we [indiscernible] I just find that -- you mentioned putting that climate aside how you would intend to do that. But there are 2 questions.

Further to the [indiscernible] so I can't comment too much. Needless to say, most are probably [indiscernible] Maari trying to divest the whole New Zealand portfolio and it's fine with the main portfolio. And so they've been pretty clear from understand to ensure that they divest all as 1 whole portfolio. Yes, obviously, we're interested to know who the partners they're dealing with and have had some engagement to try to see if there's some opportunity for us. I think there's -- we'll have to see how that plays, A lot of the companies just wanted Malaysia, just wanted pieces of the puzzle and were rejected from the process because they are firmly -- if everyone selling 1 whole [indiscernible]. So could -- that's a long way to run from what I understand is prediction right to try to sell at the same time with all the regulation parties need to be comfortable. But I wouldn't think anything is going to happen there rapidly. But obviously, once we have greater clarity, we need to see what opportunities this may or may not provide. In terms of decommissioning. So the government set down the Crown Minerals Act modifications a couple of years ago, that I can say is sort of [ vague ] as to what the security requirements would be. We have had quite a lot of engagement by ourselves and the operation [indiscernible] regulator MBIE. They provided us with guideline as to have a clean financial security working and we're seeking industry consultation on that. And now that the financial capability being [indiscernible]. And so safe to say that it is fair expectation that all companies will be putting up financial security in [indiscernible] and that historical parent company guarantees to provide a way that even bigger companies aren't going to suffice for the majority of the securities being required. So we need letters of credit, bank guarantees, sinking funds with the preference probably for the latter. So we're realistic and we understand we've got this obligation. We can't get away from it. And we expect that -- so obviously, it's a little bit determined by [ slight recession ] and on which we can get [indiscernible] that is real, but we will expect to the regulator to [indiscernible] probably over the 12 months hence we started putting the funds aside. In fact in last few years, really, there's a good lot of working capital on the balance sheet. Those funds are going on to deposits in [indiscernible] reserves. But we expect at some point, we will have to put that either into a sinking fund but in the venture for to funding our share of the level of credit to bank guarantee. It's a very -- with numbers around that. We've obviously got a $50 million-plus obligation to funds. We expect to fund it over the next 3 to 5 years, obviously, weighing up and seeing what the regulator requires, what we agree with the venture and what we're able to achieve in terms of confidence around life extension. So it's all a bit of a delicate balancing act but our priority is to set money aside judiciously while also paying a return. And what we don't want to do is give all the money back now and then hope that we going to have the money in those latter years and find ourselves in a situation where we're in an oil price -- volatile oil price cycle with the oil price pressures, and we can't fund that obligation. So we're trying to manage all of those sort of risks and building the most judicious way which seems sensible.

Richard, you know yet whether you would be setting aside by way of said sinking fund, the whole $50 million exposure or it will be after tax, that is with the 42% tax callback. Obviously, you prefer to set aside [indiscernible] $50 million. Do you have any...

Yes. I mean -- I probably have to be a little bit careful what we're saying sort of hallmarks of where they're going with the guidelines that all before it's been made to public. But if it comes down to, first of all, they assess your financial capability, not as a company, as a joint venture. And then once they get a level of surety around the financial capability that -- then they're looking for that to determine both the quantification and the form of security and they will only consider -- and this in sort of the draft. They will only consider the level of essentially a [indiscernible] but if they deem you to be highly financially capable. And it's a fairly high bar to reach is obviously complicated If I be honest, by -- on the divestment process and where that goes and we might come to see what sort of level financial capabilities that, that company may or may not have. So it's all -- we're also on this together.

[ Brent, ] I don't think -- I understand your question. I don't think we should be too smart on this because you know my background. When we look at the cost -- capital cost estimates that have been done, it depends on where you're cutting things off and what you're getting rid of. And that's not been agreed yet, and I think we shouldn't be cutting the number. And the cost estimates, as you well know, of plus or minus 30%, 50%, they never go minus, they're going to go up. So I think we've just got to be a bit careful at the moment and not try and do the financials like you want. If we may do it -- end up like that. But at the moment, from a Board's perspective, I want to have some money in me pocket.

And the other [ taxing ] points, I think the obvious point -- and you obviously understand how it works quite well, but you have to spend the money in order to get the tax credits back. So whilst we can be comfortable, we've put a little less financial security away today, we're still going to have to have 100% of the money to fund the obligation ultimately and then plan the credits back. But yes, needless to say, we're well across this. We're trying to balance all the different moving parts to make sure that company's position is well protected and that we meet our obligations along the way, whilst still trying to make sure that add and provide production on -- which would be much value...

Anybody else? Yes -- sorry didn't see you.

[indiscernible], shareholder. Regarding the investment in biochar [indiscernible].

So the biochar [indiscernible]. But biochar has -- first of all, you get a carbon removal credit, and that probably was the most valuable aspect on the biochar like a [indiscernible] and then all of that and it's a fairly permanent way of storing [indiscernible]. You can sell a carbon removal credits and the [indiscernible] over $100 a ton. So you sell carbon removal credits. [ A lot of people identify ] the char itself has a multitude of different uses. And I think the line still -- we'll get into sort of potential uses but one is it is a food for the soil, general sort of enhancements, you put it into the soil, helps water retention obviously the [indiscernible] of the soil. But the potential uses of the -- we're looking at not [indiscernible] is around for these users replacing coking coal in blast furnaces. Obviously, green steel, that's a big topic for all the steel manufacturers and [indiscernible] whether it can even just the replacement for part of the coking coal and [indiscernible]. It's got a variety of uses, but say the primary investment proposition is around the carbon removal credits.

Again it's a big [indiscernible] commodity on how to [indiscernible] and proceed with biochar [indiscernible].

It [ may not be ] credit, but let me say that our economic assessment offer when we made the investment was purely done on carbon removal on -- any residual value we got from selling that to biochar [indiscernible]. And you've got to understand under that model, essentially, we get the buyer [indiscernible]. So any other sort of buyers approach traditionally for land, for the crops or the buyer might be using it for -- even essentially in the feedstock [ mapping ]. So it's -- the value generate is how much [indiscernible] and people like that in Australia [indiscernible] commercial product. So that really what the -- there's substantial regional -- in some [indiscernible].

Thank you, Richard. anybody else? No. Okay. Well, let's move on to the business of the meeting.

Given that the notice of the meeting has been sent to all registered members, I now move the notice of the meeting as taken as read. The minutes of the previous Annual General Meeting have been approved and signed in accordance with the Corporation Act, and a copy is available for inspection in Horizon's offices. We will now move to the business of the meeting, which includes the resolutions that have been put to the meeting. Each resolution being -- before being discussed, the proxies will be put on the screen. As mentioned earlier, all resolutions will be decided by a poll and a live vote is now open on all items of business. So the first item is the financial report. The first item is to consider and receive the financial report, the directors' report and the independent auditor's report for year ended 30th of June 2003 (sic) [ 2023 ]. These documents have been made available to shareholders. There's no requirement for shareholders to approve these reports. Accordingly, item #1 is for discussion and then there will be no vote on this item. So questions on the financial report and all that's in it that we haven't addressed. No? Item #2, the adoption of the remuneration report. The meeting now needs to consider item 2, adoption of the remuneration report for the year ended 30th of June 2003 (sic) [ 2023 ]. The Board unanimously recommends to shareholders to vote in favor of this item. And proxies -- yes, are shown on the screen. So questions on the remuneration report? Okay. Thank you. Item 3 is the reelection of Greg Bittar as a Non-Executive Director. Mr. Bittar who is retiring by rotation in accordance with the constitution of the company. Being eligible, Mr. Bittar is standing for reelection. The proxies are shown on the screen, and there's now an opportunity to discuss this resolution. No? Item 3b is the reelection of nonexecutive Director, Nigel Burgess. So Nigel is retiring by rotation in accordance with the constitution of the company. Being eligible, he is standing for reelection. The proxies are up there, I think. Again, there's now an opportunity to discuss Nigel's reelection. Okay. Item 3b -- sorry, it is -- yes. Item 4 is the approval of deferred rights for Richard. The meeting now needs to consider item 4, approval of deferred rights to the Managing Director. The details of the rights plan are set out in the detail in the notice of the meetings and the proxies up there. Any comments or questions on that resolution? No? So we'll now conduct the polls. And I'm going to invite Vas to explain how the poll is going to work.

Thank you, Mike. Daniel Moses of Computershare Investor Services has been appointed as the returning officer for this meeting and [indiscernible] Computershare standards. If there is any person at this meeting who believes they're entitled to vote at and has not yet registered, would you please raise your hand for assistance. Every member present in-person or by representative, attorney or proxy to hold a yellow admission card, you're entitled to 1 vote for each share you have. The resolutions on which you are required to vote by poll are items 2, 3a, 3b and 4 as set out in the notice of the meeting. [Voting]

Back to you there, Mike.

Okay. So as the counting will take a little while, and then there'll be put up this afternoon on the ASX. So any other questions? In general. No? Thanks for coming, [ Brent ]. And I declare the meeting closed. Thank you.