HUB24 Limited (HUB) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and welcome to the Annual General Meeting of HUB24 Limited. As it is now 1 p.m., and we have a quorum present, I have pleasure in declaring the meeting open. My name is Bruce Higgins, and I am the Chairman of HUB24 Limited. I begin today by acknowledging the Traditional Custodians of the land on which we gather today and pay my respects to their Elders, past and present. This year, our shareholders have been invited to participate in the AGM online. Given the uncertainty of COVID-19-related impacts, we believe this is in the best interest of everyone's health and safety. We encourage shareholders to take part in the meeting online or over the phone. You will be able to watch in real time, submit questions and cast your votes, and I will explain more on this a little later. On behalf of the Board, I welcome our shareholders, proxy holders and guests. I'm joined in person and in accordance with the strict COVID protocols by Andrew Alcock, our Managing Director and CEO; Kitrina Shanahan, CFO and Joint Company Secretary; Paul Rogan, Non-Executive Director and Chair of the Audit, Risk and Compliance Committee and member of the Remuneration and Nomination Committee; Catherine Kovacs, Non-Executive Director and member of the Audit, Risk and Compliance Committee; Anthony McDonald, Non-Executive Director and Chair of the Remuneration and Nomination Committee, who now joins us online; Ruth Stringer, Non-Executive Director and member of the Audit, Risk and Compliance Committee; and Andrew Brown, Joint Company Secretary. Company Secretary, are there any apologies?

Chairman, there are no apologies.

Also present today are the Deloitte auditors, Mr. Stuart Alexander, Audit Partner, Returning Officer and moderator; and Nicholas O'Hagan, Client Relationship Manager for Link Market Services. The notice of meeting has been mailed, and I now move to that. The prepared AGM materials from myself and the Managing Director and CEO have been released to the market. I will make the Chairman's address to be then followed by the Managing Director and CEO address and then proceed to the business of the meeting. Firstly, we will take questions related to the annual report and the accounts and then proceed to the 4 resolutions for consideration by shareholders. I would ask that questions of a general nature regarding our business are reserved until the conclusion of the resolutions. Before giving an update on HUB24's performance during the year, I would like to outline the technical and procedural matters for this meeting. In terms of voting, an online virtual meeting guide, which explains how shareholders may participate in the meeting, was released to the market and is on the HUB24 website. This is also available in the download section of the online platform. If you are participating via the AGM online platform, you will see a video stream on the left and the presentation slides on the right. At the bottom of the screen, there are 3 boxes. These allow you to get a voting card, ask a question and download the relevant documents. The poll will be conducted and scrutineered by our share registry, Link Market Services. Only shareholders and their representative, proxies or attorneys are entitled to vote. Resolutions 1, 2, 3 and 4 are ordinary resolutions, meaning that to pass, they require more than 50% of the votes cast by members entitled to vote on the resolutions to be carried. Thank you to those shareholders who submitted questions and comments prior to the meeting. We will address those questions as they relate to each resolution. If you have a question that you would like to ask today, there are 2 ways to do so. [Operator Instructions] There is a limit of 512 characters for written questions. To ensure you have enough time to type and submit your question, I encourage you to start typing now instead of waiting until later in the meeting. Online questions that are relevant to the business of this meeting will be read aloud to me by the moderator. We may aggregate questions if we receive multiple questions on the same topic. The second way to ask a question is by phone. [Operator Instructions] We'll first take questions from shareholders using the online platform and then take questions received over the phone. I will now summarize the voting procedures. All items of business will be voted on by poll, which is now open. If you did not cast your vote prior to the meeting, you may cast a live vote using the online platform. Please click Get a Voting Card and follow the prompts. You may cast your live vote at any time during the meeting. Live voting on online platform will close at the conclusion of the meeting. You must be logged on to the online platform to cast a vote. You cannot cast a vote over the phone. I confirm that where undirected or open proxies have been given to me as Chairman, I will vote in favor of the resolutions to the extent permitted. During the meeting, we will display on the presentation slides the number of proxy votes received prior to the meeting on each resolution. The final results will be released to the market as soon as they are available. If you experience any difficulties using the online platform, a help line number is displayed at the top of the page. Please ring 1 (800) 990-363. If we experience significant technical difficulties during the AGM, we will adjourn the meeting until 4 p.m. Sydney time today, unless otherwise stated. If this occurs, a market announcement will be made and our website updated. Shareholders, proxy holders and guests who have registered to watch the meeting will be notified via text. I will now make my formal Chairman's address. In what has been another challenging year for the Australian communities and businesses with the COVID-19 pandemic still having a significant impact, maintaining the well-being and effectiveness of our teams has remained a priority. Our HUB24 team has worked tirelessly to achieve our business objectives and continued to deliver customer service excellence. I thank them very much for that. Our management team has performed very well in leading the business throughout this period of transformation and growth while the pandemic has continued. HUB24's footprint in financial services has grown considerably during FY '21 as the company completed a series of strategic transactions, which delivered increased scale, provided new client relationships and product capability to address and access new client segments. HUB24 has achieved strong organic growth through our core business. And in addition, we have also increased Funds Under Administration, FUA, from acquisitions. And the company's success has also been reflected in the key financial metrics for the year. I'm very proud of the fact that our group revenue grew 34% and platform revenue increased by 36%. The group's preferred measure of profitability is underlying earnings before interest, tax, depreciation and amortization. This increased by 47% to $36.2 million. Our statutory net profit after tax was $9.8 million after incurring transaction-related costs of $8.2 million from the completion of the series of strategic transactions we announced in October 2020. During FY '21, the company has delivered significant growth. And according to the latest available platform market share data, HUB24 has maintained second position for annual net flows and has increased our market share to 4.3%, which now includes acquired business, Xplore. HUB24 is now the seventh largest platform by market share, up from ninth place at this time last year. HUB24 has now delivered a compound annual growth rate of 66% in FUA over the last 5 years. HUB24's record organic growth is a result of the increased distribution footprint, product innovation and customer service excellence. HUB24 has built a strong relationship across the segments of the market, including growing mid-tier licensee segment, self-licensed advisers, advice collectives, boutiques and brokers. Overall, market conditions for HUB24's value proposition continue to present significant opportunities for growth. And our sales pipeline remains strong across all segments. As a result, the company will continue to invest appropriately to take advantage of these opportunities. Given these strong financial results, the company announced a fully franked full year dividend of $0.055, which brings the full year dividend to $0.10, an increase of 43% on the prior year. Our share price is also reflected in the company's performance and an improvement of 33% since the last Annual General Meeting. As well as delivering strong growth and supporting our clients, the company has remained committed to continued innovation and delivering on our strategic objectives. Throughout FY '21, the company has continued to make enhancements to the platform to provide flexibility and ensure our advisers and their clients have access to a broad range of investment options. HUB24 is committed to supporting licensees and advisers through ongoing regulatory change. This year, HUB24 worked with licensees and advisers to deliver a flexible approach to the new advice fee opt-in requirements and are supporting licensees with education for the requirements arising from the legal obligations to comply with distribution and design obligations. During FY '21, the company completed a project to streamline our market-leading managed portfolios into a non-unitized managed investment scheme, thus laying the foundations for future innovation and providing additional client benefits. Throughout the year, the company worked with 2 large licensee clients to launch our first private label offerings. In May, the bulk transition of $1.4 billion in FUA was completed from ClearView Wealth across to the new ClearView Wealth private label solution on HUB24. Our new private label offer was also launched to the IOOF network of advisers in Q4 FY '21. We also welcome both the Ord Minnett PARS and Xplore teams to the HUB24 during the year. The acquisition of Ord Minnett's PARS was completed at the end of November, which together with the acquisition of Xplore, facilitated HUB24's entry to this segment. And work is underway to transition PARS from Ord Minnett systems to HUB24. The acquisition of Xplore Wealth was completed in March. Distribution, product and compliance teams have been integrated. And we are leveraging our collective capability to progress the development of product solutions for existing and new clients. As part of the strategic investment in Easton, a technology and partnership agreement has been put in place, under which HUB24 will collaborate with Easton to develop product solutions, which leverage HUB24's data and technology expertise. Given growing demand for cost-effective financial advice, HUB24 has been working with a group of licensees for some time to better understand their business challenges and provide the data they need to run more efficient businesses and replace the manual processes that increase the cost of advice. HUB24connect (sic) [ HUBconnect ] licensees provide a range of solutions that can help licensees create efficiencies and reduce manual processes by leveraging data to support business management activities like monitoring key risk indicators or remuneration reporting. A pilot is underway with 4 licensees, and the capability will be rolled out to other licensees during FY '22. During October this year, we announced the proposed acquisition of Class Limited. The proposed transaction is expected to accelerate the company's platform of the future strategy, consolidating the group's position as a leading provider of integrated platforms, technology and data solutions. The combined business will provide a compelling and unique competitive advantage and diversification of revenue. You may have seen an announcement this morning providing an amendment to the Scheme Implementation Deed. Our Managing Director, Andrew Alcock, will cover this in more detail during his presentation. I'll make a few comments regarding our corporate governance. Our Board of Directors and management will remain committed to our duties and obligations to maintain and improve our robust system of corporate governance. The ongoing review and improvement of corporate governance practices and processes are fundamental to our business, and ensuring HUB24 maintains industry best practice, including our reporting, commitment to diversity, expanding the skill set across the board, are all active engagements. As the company grows, we continue to invest in our corporate governance, risk and compliance frameworks and to develop and articulate our ESG principles to ensure they are fit for purpose and commensurate with not just the present demands but for our growth trajectory. In March, Ian Litster retired from the Board, and we would like to thank him for his many years of service. An extensive search was undertaken. And in July 2021, we announced the appointment of Ms. Catherine Kovacs as Non-Executive Director. Ms. Kovacs has a broad financial services experience spanning fintech, business strategy and growth and investments, including M&A. Catherine's reelection is set out in resolution #3. In conclusion, the company is proud to have delivered an extremely successful year, achieving record levels of net platform inflows, FUA growth as well as completion of 3 strategic transactions and continued industry recognition as the market leader in both platforms and managed portfolio space. Shareholder value has grown significantly in recognition of our strong financials and our operating performance. As a result of our continued investment and completion of strategic transactions this year, we are well placed to pursue emerging opportunities for growth as we lead the industry in the provision of integrated wealth platform, technology and data solutions. I'm very pleased to report that record growth in FUA has continued into the first part of this financial year FY '22, and I look forward to providing shareholders an update for the full half year in February. As mentioned previously, we will be open for business operational questions following the completion of the formal proceedings of this AGM. I would like to now hand over to our Managing Director, Mr. Andrew Alcock, who will go through the achievements of FY '21 as well as future outlook in further detail. Andrew?

Thank you, Bruce, and good afternoon, everyone. Since we last met at the AGM last year, HUB24 is quite different, and we've got a slide here about our current footprint. I'll just do that. So as the leading provider of integrated wealth management products and services, we do lead the market in terms of managed portfolios with a great range of investment options on our platforms as well. But our business is far more than that. So on the slide here today, we outline the business. There's a total FUA in the business of $63.1 billion, which is up from $17.6 billion or $17.7 billion last year at the end of FY '20. So as our Chairman, Mr. Higgins mentioned, we had undertaken some transactions in the last year. And so breaking it down, our Platform business has $45.4 billion of FUA in it today. At the end of the financial year, it was $41.4 billion. And so growth in that being the net inflows of $3 billion in the first quarter we reported to the market in our quarterly plus some market movement. The adviser numbers are positive, and the managed portfolio of funds under administration is now at $18 billion. The Portfolio Admin and Reporting Service, or as we call it PARS, which is us moving forward in our strategy with building the platform of the future, which provides a tax reporting and portfolio admin service for assets not held by custody by HUB24 but it's a data platform, if you like. That's at $17.8 billion with over 7,500 accounts. And finally, as part of our footprint today, we have 92 institutional financial services clients buying software and data services from HUB24. And as the Chairman mentioned, the prototypes we've been doing with licensees in the marketplace using artificial intelligence and technology to enable better access to advice is continuing with those prototypes under the brand of HUBconnect with our Insight range. All of these initiatives align to the strategy, which I'll outline during our presentation. Some more detail on the financial highlights for FY '21 and some positive numbers there with revenue up 34%, underlying EBITDA up 32%, and as Bruce mentioned, our $0.10 full year dividend. But all the statistics quite strong with remarkable growth during the year, which we're very proud to have delivered for shareholders. As I said, total FUA today is $63.1 billion, but at 30 June, it was $58.6 billion. And the growth so far in the first quarter, as Bruce mentioned, has also continued. And we're looking forward to updating further. So at the moment, we've got great trajectory and great trends in the business. What's interesting though, those results come off the back of a strong and stable, reliable history, if you look at the last 5 years of HUB24, with a 5-year revenue compound annual growth rate of 36% and underlying EBITDA growth rate of 57% with the last 5 years mapped there as well. So strong, reliable, sustainable growth. We hope to continue to deliver that moving forward and certainly having a strong year-to-date as well. In terms of our market share and FUA on the left-hand side of this chart, you can see that we are still, as a ratio of our new business to our existing market share, punching above our weight, so to speak, with being in second place in terms of our share of new business compared to our current market share and with other platforms with shrinking market share, generally representing traditional incumbent platforms or those who are exiting wealth management being the banks and others. So our market share over the last 12 months has grown from 2.1% to 4.3%. We're the seventh largest platform, up 2 places from a year ago, and we've maintained our second position with flows. Again, it was great this year and a year of great growth and change to be awarded the Best Overall Platform by Investment Trends and the best for platform service by Wealth Insights, and again, having won the Managed Accounts award for the fifth year running. What's really interesting to us on this slide is on the right-hand side. If we look at the data beneath the awards, HUB has the highest adviser consideration for advisers who are choosing a new platform. So if you're a financial adviser in the marketplace and you're considering a new platform, HUB is more likely to be the platform that you will choose moving ahead. Similarly, if you're looking to leave your platform provider, and that's the bottom point of the slide, advisers who use HUB24 are the least likely to look for a replacement platform in the next 12 months. So the sentiment indicators are backing up the awards and the sentiment from those awards in the marketplace. Bruce mentioned we had a year of growth and innovation, delivering on strategy. And it certainly has been a remarkable year with record flows that have continued into our first quarter of FY '22, having also at the same time undertaken the bulk transition of ClearView, having launched 2 private labels and actually done 3 strategic transactions and won those awards. It's been a fantastic year for HUB24. We're very excited about what lays ahead. We are continuing to enhance our offer. We're streamlining our offer and collaborating with licensees to build even greater value and greater products in the future. In terms of strategy and outlook for the business, our strategic purpose is to empower better financial futures together. And that means a lot for all of us at HUB24. It is about us working together with other industry participants being financial advisers, being investment managers, being insurance providers or technology providers to provide a better financial future and empower a better financial future for consumers. We'd like to lead the wealth industry as the best provider of integrated platforms, data and tech solutions. And as such, we've got 3 strategic pillars through which we intend to deliver on that strategy. The first one, to deliver customer growth and value. So to continue to develop our platform position to meet evolving customer needs and extend our market leadership and deliver better value or growth. I quite often talk about using technology to unlock value for consumers. And the paradigm of the world which we live in now is actually doing that. We're moving forward with ways that you can use technology to create what we might call platform or execution alpha, which gives a better result or empowers a better financial future for a consumer. We're continuing to build the platform of the future, evidenced by some of the acquisitions we've undertaken and the work we're doing in that space in terms of non-custody or the PARS service, and we're continuing to collaborate to shape the future of the wealth industry by working with our customers and other industry participants to build better solutions that enable and evolve the accessibility and the affordability of advice for Australians. And so those are the 3 strategic pillars under our goal of enabling better financial futures together. The market opportunities represented though are continuing to remain, and they're quite sizable. If we look at the superannuation market in Australia, it's growing at 11.3% per annum. So great growth in the superannuation marketplace and our addressable markets there on the slide with a large slice of the market. We also participate in the SMSF or self-managed superannuation market as well. Platform, the Australian platform market, ranked #1 and the stat there on the slide at 3.9% at March and 4.3% at June. There's a lot of room for HUB24 to continue to grow and increase market share in that part of the industry. In the managed accounts market, as I said, we are the leader, having won an award for 5 years in a row and having the highest market share than others in this particular market, in a market that is actually researched to grow potentially 44% per annum. So lots of opportunity for HUB being the dominant player in the market to continue to grow there. And also in the Portfolio Admin and Reporting Service or non-custody market, we have 12% market share and plenty of room to grow there. So in summary, being the market leader with great results in terms of industry research and financial adviser accolades with lots of room to grow and a growing market, we're very well positioned to take advantage of future opportunities. A few highlights on how we're moving forward on those strategic pillars and some of those growth opportunities. We're currently in the process, and as we've announced to the market, we are actually expanding our executive team and expanding our sales team to build new relationships to deliver on that growth. And as we said, we've had record flows 3 quarters in a row. And so resourcing up for that future growth as well. We're continuing to develop our value propositions as well and look at different customer segments, particularly with the Xplore transaction and the Ord Minnett PARS transaction, looking at how we actually build out those products for the future for those new customer segments. In terms of continuing to build the platform of the future, we intend to keep working on completing the integration of those strategic transactions to develop combined customer offer and build and expand market share there. And as our Chairman announced, we've also got the proposed transaction to purchase Class Limited, which also extends to that model of building the platform of the future. And we're continuing to collaborate to shape the future of the industry with expanding the data sources for HUBconnect and building best of breed solutions and leverage that AI and machine learning capability to really transform the cost of delivering advice and build detection and prevention measures into the delivery of advice for advisers rather than the method of doing audits previously. So trying to make advice more accessible and affordable by leveraging technology and building safeguards into it with financial advisers. So customers can engage with their advisers, and their advisers can deliver better service and spend more time doing the core business as opposed to dealing with regulatory change and having to focus on compliance outcomes after the event rather than having software and technology help enable that and deliver better outcomes. The proposed acquisition of Class. We've got the strategic rationale here on the slide, and we talked about strategic pillars earlier about the platform of the future. Class is a very, very well-run business, which is the market leader in the provision of establishing, managing and administering wealth vehicles. The combined business of Class and HUB24, we hope, will benefit from increased scale, capabilities, product offering and distribution reach. In terms of how does Class fit in that rationale, it aligns with our purpose to empower better financial futures and accelerates our platform of the future and data services market leadership. And I'll talk more about that on the next slide. Definitely, we hope that the acquisition of Class will deliver growth opportunities by levering the combined capabilities of both businesses being leaders, tech leaders and fintech leaders to build efficiency for existing customers and for new customers as well. The acquisition of Class will deliver shareholder value through diversification of revenue opportunities for growth and allow us to build compelling and unique competitive advantages on how advisers and customers can leverage an SMSF with a platform, or self-managed super fund. And it combines 2 market-leading businesses with a track record of innovation and the capacity for ongoing investment, leading up to our vision to be the leader in the industry of the best provider of integrated platforms, technology and data solutions. Both being market leaders, both being complementary businesses. As I said, Class are the leaders in establishing, managing and administering wealth vehicles with the capability in self-managed super administration with the Class Super product, trust administration with Class Trust. They have a document management business that allows you to set up trusts and set up all the requisite needs for establishing an SMSF or a trust, a testamentary trust, and working as an agent with ASIC as well and working with accounts to streamline that functionality. They have 7,500 -- or 7,700 unique customers and are also market leaders in their own space, having won multiple awards. They operate in a similar market to HUB24, ideally -- sorry, additionally with accountants and auditors and administrators, SMSF trustees. And interestingly, 25% of HUB24's customer base are SMSF trustees, i.e., 25% of the funds under administration of HUB24 platform come from self-managed superannuation funds, hence the complementary nature of the acquisition. Class has 250 data integrations in order to produce some of the statements and accounting records they produce for the Class Trust and SMSF vehicles, complementing the 96 data integrations that HUB24 has. So referring back to our strategy build the platform of the future, not only does Class provide an adjacency for our business, a way of streamlining and building products together for the same marketplace. It also helps extend our ability to build our data and technology solutions for the broader marketplace. The indicative time line for the transaction is on the slide here with the first court hearing expected to occur this week, leading up to an implementation date of late -- mid- to late February, subject to court approval and shareholder voting, second court hearing in early February, with an effective date of the transaction plan to be early February as well. In terms of the outlook for HUB24, it's been a great start to the year so far. We are positioning the business for ongoing success. We're continuing to invest in product, service and customer excellence. We're continuing to integrate the businesses that we've acquired and continue to collaborate with the industry. So we are positioning the business for success even further. We are actively pursuing growth by leveraging our current relationships and adviser relationships, and we're capitalizing on the current favorable conditions to continue to grow and build market share and build on the strong first quarter result. As a result, we expect our financial results to also to continue to grow strongly and to leverage the growth in funds under administration and scalability to deliver more shareholder value and increase profitability. And as for our market target statement on funds under administration, which we released with our annual results on the 23rd of August, a target range of $63 billion to $70 billion by the end of FY '23. With the strong results to date with $3 billion for the first quarter, we're very comfortable that we're tracking very well and made great progress on what was a very ambitious growth target. So the outlook for HUB24 is positive. The business is well positioned. We're well rated. We have lots of runway in terms of market opportunities and market share to gain. And hopefully -- we look forward to delivering that for our customers and for our staff and for shareholders moving forward. I'll now hand back to the Chairman, Mr. Bruce Higgins.

Thank you, Andrew. I must say, Andrew and his team and all staff have just done a fantastic job this year. And the Board is very appreciative of their commitment and their hard work. Well done, Andrew. Thank you. We'll now move to the items of business. The notice of Annual General Meeting was mailed to shareholders on the 12th of November, and I propose that this and the accompanying explanatory memorandum be taken as read. The key items of business on today's agenda include, firstly, to receive and consider HUB24's financial report, the directors' report and the auditor's report for the year ended 30 June 2021; to consider the 4 resolutions put before this meeting; and to take any general questions. The first item of business is to receive and consider HUB24's financial report, the directors' report and the auditor's report for the year ended 30 June 2021. Mr. Stuart Alexander, our external auditor from Deloitte, is available to take questions on the conduct of the audit and the preparation and content of the independent audit report. There will be no vote on this item, and this is a discussion item only. I'll now take questions received through the online platform on the HUB24 financial statement, directors' report and auditor's report. Moderator, are there any questions regarding the accounts?

Thank you, Chairman. There are no questions on this item of business.

I'll now take questions received over the phone on the HUB24 financial statement, directors' report and auditor's report. Phone moderator, are there any questions?

Chair, there are no phone questions for this item of business.

The financial report, directors' report and auditor's report are noted. The next item of business is to consider the remuneration report. To consider, and if thought fit, to pass the following resolution as an ordinary resolution: that the remuneration report for the company for the year ended 30 June 2021 be adopted. The resolution on this item is advisory, but we will take shareholder feedback into consideration when formulating HUB24's future remuneration policies. I will now take questions received through the online platform on this item of business. Moderator, are there any questions relating to this item of business?

Thank you, Chairman. There are no questions on this item of business.

Are there any questions on this item of business through the phone?

Chair, there are no phone questions for this item of business.

Detailed on the slide in front of you are the proxy votes for this item submitted prior to the meeting. As noted in the notice of meeting, I intend to vote all open proxies in favor of this item. I would ask that shareholders enter their votes for resolution #1 now. [Voting]

The next item of business is to consider the reelection of Paul Rogan as a Director of the company. To consider, and if thought fit, to pass the following resolution as an ordinary resolution: that Paul Rogan, a Non-Executive Director of the company, who retires from office of Director by rotation in accordance with rule 65.1 of the Constitution and ASX Listing Rule 14.4, being eligible and offering himself for reelection, be reelected as a Director of the company. The Board, excluding Paul Rogan, who abstains from making a recommendation due to his personal interest in this resolution, recommends that shareholders vote in favor of this resolution. I will now invite Paul to say a few words regarding his election.

Thank you, Bruce. Good afternoon, everybody. As Bruce has just outlined for you, I'm seeking your support today for the reelection as an independent Non-Executive Director of HUB24. I joined HUB24 Board in December of 2017. And since March 2018, I've had the privilege of chairing the Audit and Risk Committee. In August of last year, I was appointed as a member of the Remuneration and Nominations Committee, and I participate in various forums associated with the strategic transactions that Bruce and Andrew have outlined. I'm also a Non-Executive Director of Equity Trustees Superannuation subsidiary and -- where I'm a member of the Audit Committee as well as the Onboarding Committee, which is relevant to overseeing new client funds coming on to the company, as well as the Nominations Committee. I'm also the founder and CEO of a fintech start-up, which assists seniors to access the government's reverse mortgage solution known as the Pension Loans Scheme. My portfolio currently permits me to dedicate significant time to HUB's stakeholders' interests and the market opportunities that are present and emerging. Whilst my professional background is in finance and accounting, including serving as a former CEO of an ASX 200 company, the majority of my executive career has been leading teams and organizations through periods of significant growth or change, both here in Australia as well as in the United Kingdom and in Europe. I've spent almost my entire career in financial services, spanning banking, life insurance, wealth management, asset management, superannuation, advice and broking. And this experience, I believe, I'm able to bring to bear to the interest of HUB24. I very much enjoy my role at HUB24. And with your support, I look forward to continuing to working with my colleagues on the Board, Andrew and his executive team in pursuing, delivering value for all stakeholders. Thank you for the opportunity to address you this afternoon. Back to you, Bruce.

Thank you, Paul. I'll now take questions received through the online platform on this item of business. Moderator, are there any questions regarding this item of business?

Mr. Chairman, we have no questions on this item of business.

Thank you. Are there any items of -- or questions on this item over the telephone?

Chair, there are no phone questions for this item of business.

Detailed on the slide are the proxy votes for this item submitted prior to the meeting. As noted in the notice of meeting, I intend to vote all open proxies in favor of this item. I would ask that shareholders enter their votes for resolution 2 now. [Voting]

Thank you. The next item of business is to consider the reelection of Catherine Kovacs as a Director of the company. To consider, and if thought fit, to pass the following resolution as an ordinary resolution: that Catherine Kovacs, a Non-Executive Director of the company, who was appointed to the office of Director by the Board to fill a casual vacancy and who retires from office of the Director in accordance with rule 64.2 of the Constitution and ASX Listing Rule 14.4 and being eligible and offering herself for election, be elected as a Director of the company. The Board, excluding Catherine Kovacs, who abstains from making a recommendation due to her personal interest in this recommendation, recommends shareholders vote in favor of this resolution. I'll now invite Catherine to say a few words regarding her election.

Thank you, Bruce. Good afternoon, everyone. Today, I seek your support for reelection as an independent Non-Executive Director of HUB24. I joined the HUB24 Board in July of this year, and I'm a member of the Audit, Risk and Compliance Committee. I concurrently serve on the Board of ASX-listed company, OFX, where I'm a member of the Audit and Risk Committee; the University Admission Centre for New South Wales; ACT, a commercial not-for-profit; and private company, Equitise. This portfolio allows me to dedicate a good percent of my time to serving at HUB24. I bring both operational experience and executive investing experience to my role at HUB24. In my 25 years plus executive career, I built a number of innovative businesses within large Australian financial companies by gaining a deep understanding of customer needs, market trends and advancements in technology and by leading high-performing teams. As an executive sponsor and as a personal investor, I've made numerous investments in fintech companies and disruptive business models, and I have a keen eye on the future of financial services and the wealth industry. My executive experience in equity markets, work in wealth management and M&A activity all combined to give me a strong understanding of investor expectations. A career in large, complex, highly regulated organizations enables me to appreciate the systems and processes required for strong governance at HUB24. I'm also focused on ensuring the company is able to make a difference through its commitments to ESG matters. With your support, I'd be honored to work alongside Bruce and the Board to support and challenge Andrew and the management team to continue the great work they're doing for our shareholders, employees customers and community. Thank you for the opportunity to address you today.

Thank you, Catherine. I'll now take questions received through the online platform on this item of business. Moderator, are there any questions regarding this item of business?

Thank you, Chairman. There are no questions in relation to this item of business.

Are there any questions on this item over the telephone?

Chair, there are no phone questions for this item of business.

Thank you. Detailed on the slide are the proxy votes for this item submitted prior to the meeting. As noted in the notice of meeting, I intend to vote all open proxies in favor of this item. I would ask that shareholders enter their votes for resolution #3 now. [Voting]

Thank you. The next item of business is to consider and approve the issue of performance rights to Andrew Alcock. To consider, and if thought fit, to pass the following resolution as an ordinary resolution: that for the purposes of ASX Listing Rule 10.14 and for all other purposes, the issue of 35,901 performance rights to Andrew Alcock under the company's performance rights plan on the terms set out in the explanatory memorandum to this notice be approved. The Board, excluding Andrew Alcock, who abstains from making a recommendation due to his personal interest in this resolution, recommends that shareholders vote in favor of this resolution. I will now take questions received through the online platform for this item of business. Moderator, any there any questions regarding this item.

Thank you, Chairman. There are no questions in relation to this item of business.

Are there any questions on this item over the telephone?

Chair, there are no phone questions for this item of business.

Thank you. Detailed on the slide are the proxy votes for this item submitted prior to the meeting. As noted in the notice of meeting, I intend to vote all open proxies in favor of this item. I would ask that shareholders enter their votes for resolution #4. [Voting]

Thank you. If shareholders have not voted at this stage, I encourage you to please vote as voting will close at the conclusion of this meeting.

We have received prior to the meeting a number of questions that we will now address as well as take any other questions. We have received a question from a shareholder asking what are the benefits of the proposed transaction with Class Limited. Andrew, I'd ask that you address this one.

Thank you, Bruce. And I think on the slide, I talked about the rationale. But if I sort of paint the picture of the marketplace right now, today, in superannuation in Australia, younger people are entering the system at a younger age than perhaps I did. They're entering the system with a contribution level of 12% per annum. And I think that puts younger people who are more interested in securing their financial future are more tech savvy as it creates a picture for a growing SMSF marketplace. So the SMSF market has not grown as much in recent years during the time of the Royal Commission and disruption in this industry. And we're starting to see growth again. And I think if you imagine a world where HUB24 can work with Class to make a frictionless solution where an investment platform can be linked to a self-managed super fund, you can see the benefits of that in terms of making that easier for advisers and customers to get advice and secure or empower their financial futures. So indicatively, there's great market opportunities for growth. The transactions we announced into the market, we announced with an 8% earnings per share accretion for HUB24. And that was based on expense synergies or a small amount of expense synergies of $2 million per annum. And that in itself makes the transaction worthwhile for HUB24 shareholders as well as delivering diversified revenue. So when you look at the strategic possibilities of that business, when you look at the landscape and the predicted growth in self-managed super funds, when you look at our view of building a platform of the future that's database with the Class heavy investment in data and so forth, there's lots of opportunities to collaborate and build better products and better solutions for clients as well as deliver on the current good earnings of Class to date. So I think the benefits are there for Class shareholders. The benefits are there for Class employees but also for customers and also the industry. And hopefully, that adds up to benefits for HUB24 as well. I should note that this morning, we did also make an announcement about an amendment to the Scheme Implementation Deed that streamlined the offer for Class and increased the consideration in return for Class not declaring a dividend or an interim dividend. So the scheme consideration is 1 HUB24 share for 11 Class shares, and it was plus 10% -- $0.10 of cash. That's now been increased to $0.125 in cash and removed some uncertainty about the timing of dividends and so forth and increases that offer. And so as I said in my earlier address, the court date is this week. So hopefully, that answers the question. I think it's a really compelling transaction, 2 market leaders coming together in a world where technology is making a difference. I think there's great opportunities to leverage those -- both those businesses to give good results for shareholders and customers of both companies.

Thank you, Andrew. Another question relates to a shareholder's individual circumstances and our complaints policy. And we confirm that our complaints policy is available on our website and that the particular personal situation referred to there, that review of that is that we're in accordance with that policy. And the issues raised were referred and dealt with promptly and in accordance with that policy. And in each case, we responded within 24 hours of each step of that process. So I'm quite pleased with a review of that outcome. I will now take questions received through the online platform. Moderator, are there any questions?

We have no general business questions at the moment.

Thank you. Are there any questions over the phone?

Chair, there are no phone questions at this time.

Ladies and gentlemen, if you've not finalized your voting, please do so now as the voting will shortly close at the conclusion of this meeting. The results of today's AGM will be released to the market and made available on the HUB24 website as soon as possible, which should be later this afternoon. As there is no further business for the meeting and no further questions, I declare the 2021 AGM for HUB24 Limited closed, and I look forward to meeting each of you perhaps in person in 12 months' time at the next AGM. Thank you for your attendance and for those shareholders who participated by proxy. Thank you.