Infotrust Ltd (ITS) Earnings Call Transcript & Summary

Good afternoon all. My name is James Joughin, and as Chair of Spirit Technology Solutions Limited, it's my pleasure to welcome you to the 2024 Annual General Meeting. Today, shareholders will be able to view and participate in the live webcast of the meeting, ask questions and cast direct votes at the appropriate times whilst the meeting is in progress. I note that we have complied with the relevant requirements for convening this meeting, and a quorum is present. So as the time has now just passed 12:00 p.m., I formally declare the meeting open. Today, I'm joined by my fellow Directors, Mr. Julian Challingsworth, our Managing Director and CEO; our Non-Executive Directors Ms. Lynn Warneke, Mr. Shan Kanji and Mr. Russell Baskerville; Directors Simon McKay and Dane Meah, our apologies for today's meeting. I would also like to welcome Mr. Paul Miller, our Chief Financial Officer; and Mr. Stefan Ross, our Assistant Company Secretary. In addition, we have Ms. Kaitlynn Brady, representing PKF, the company auditors, and she is in attendance. And she will make herself available during the meeting to answer any questions on the accounts at the appropriate time. The Notice of Meeting has been given in accordance with the company's constitution, and the copies are available for you at the company's website or on the ASX announcement platform. The purpose of this meeting is set out in the Notice of Annual General Meeting dispatched to shareholders. And unless there are any objections, I will take the notice as having been read. The format of today's meeting will be some brief opening remarks from myself, a presentation on the operations of the business by our Managing Director and CEO, Mr. Julian Challingsworth, followed by a Q&A session on the company's operations. We'll then have the formal consideration of the business on today's agenda, with an opportunity to ask questions on any of the formal business at the end of the last resolution. And lastly, completion of the poll voting on the formal items of business. In order to ascertain the true intention of shareholders and to reflect our focus on transparent governance, in accordance with the company's constitution, as Chair, I have determined to call a poll on all resolutions to be considered at today's meeting. I will now provide my opening remarks, following which, I'll hand over to Julian to provide an update on the company's operations before we move to the formal items of business for today. The FY '24 year was an extremely busy period, both operationally and structurally. During the year, Spirit has welcomed a new major shareholder, Mr. Shan Kanji, completed 2 acquisitions in the cybersecurity sector, refreshed the Board and completed 3 capital raisings. Concurrently, the restructure and turnaround of the Managed Services business continued to restore the business to profitability as we enter into FY '25. Our strategy is to become a leading Cyber Security business. And because of the acquisitions of Infotrust and Forensic IT, the majority of the group revenue is now driven from cyber activities. With this hard work completed during FY '24, the Board is now comfortable the combined group will be profitable. I would also like to welcome some of our new directors who are here today, Mr. Shan Kanji, an investor and significant owner of the shares in Spirit; and Mr. Russell Baskerville, formerly CEO of Empired Limited, who has a strong background in managed services and joined the Board last month. As you know, I'm retiring from the Board at the conclusion of this AGM, and Shan Kanji has been appointed as Chair going forward. I've been Chair since the business undertook a reverse listing in 2016, and I've experienced the highs and challenges of growing and sustaining a micro cap business. But I'm pleased I'm leaving the business in very good financial shape with a great future, and I'm confident the Board has the deep industry skills and energy to take Spirit to the next level. I would also like to thank our other Directors, Simon McKay, Lynn Warneke, Dane Meah, as well as Greg Ridder and Elie Ayoub, who retired during the year, for their contribution and value add to the Board's program of work during the year. I would also like to acknowledge the hard work of our Managing Director and CEO, Julian Challingsworth, and our staff who have been relentless in assisting with reshaping and developing the business. On outlook. We are now experiencing the benefits of the focused cyber strategy, and we have been successfully winning significant new contracts, and we are experiencing growth in our sales pipeline for integrated managed services and cyber proposals. Cyber Security is consistently on all Board risk registers, and we have the capabilities and skills to gain a meaningful share of the spending in the sector. The Board is confident of a bright outlook for the group. Now before I hand over to our Managing Director, who will conduct the presentations on the company's operations, we will take questions on the company's operations following Julian's presentation, with questions on the formal items of business to be conducted at the end of the last item of business. Shareholders wishing to ask questions via text, please take note of the following instructions. Please select the Q&A icon located at the bottom of your screen and type your questions in Ask a Question box and press the Send arrow. Your questions will be addressed at the appropriate time. Shareholders wishing to speak and ask a question, an audio questions facility is available during this meeting. Please follow this process. Please click the Raise Hand icon located at the bottom of your screen. You'll be placed in a queue and authorized to speak when we raise the Q&A session. Prior to asking your questions, please state your full name and who you are representing. So over to you now, Julian. Thank you.

Thank you, James. 2024 was really a year of transformation for the Spirit Group. I think, across the board, we are proud of what we've achieved, though realize that there is still significant work to go. Our Communication and Collaboration team had a challenging first half of the year, but came back strongly in the second half of the year, and we've seen some very positive results as we move forward there. Our managed service team followed through with the restructure and undertook a lot of work to return the business to its breakeven position, setting itself up for the future in a position where we now have a solid offer based around the key secure Managed Service offers that we want to take to market. And as the Board strategy pivoted towards the secure element in our overview, we really took the opportunity to look at the market, look at our capabilities and brought 2 new organizations into the business, Infotrust and Forensic IT, which I'll discuss in a little bit more as we go through the presentation. As we go in to wrap up '24 today and look to '25, our key strategy remains around these pillars of secure, helping organizations meet their security requirements in an evolving and complex landscape, working with technology to help them understand their sustainability and the impact that carbon reporting is going to play over the next couple of years. And then Managed Services' turnaround, providing scalable communication solutions, scalable technology that helps them realize key thematics around moving to the cloud, embedding AI into their products and being more scalable and efficient as an organization. Next slide. So FY '24, again, it was a year where we undertook a significant amount of restructuring, revenue of $126 million, underlying EBITDA of $1.7 million, which was fundamentally a disappointing result for where we wanted to be. I think 2 key drivers of the result there, our Communication and Collaboration practice were materially impacted by interest rate rises. The half 1 FY '24 was a very flat year within their customer base. Their customer base is predominantly small businesses in Australia, and they were very sensitive to interest rate rises. Second half FY '24 saw a return to normal for that business a return to growth, and we've seen that continue into FY '25. So we're feeling positive that both the Communication and Collaboration team and the Spirit Business Center, where they're opening and engaging with new organizations to create a channel, we will see positive returns for the organization there. As I touched on earlier, Managed Services, as a result of the delays in restructuring program was a significant drag in our FY '24 results. I think the positive note, although it was a drag on the full year results, we exited the year in a breakeven position, and we move into FY '25 with a much more stable base with a clear product set, clear understanding of our markets and a baseline to start to grow. And I think when we get into the slide to discuss the bridge between FY '24 and our current guidance at FY '25, you can see the reduction of that loss is a significant contributor to a more reasonable guidance number that we've proposed. And of course, as James mentioned, the biggest changes across the year were with our Cyber Security team, where we've done 2 significant acquisitions. Infotrust, it's brought in a lot of scale, and Forensics brought in some new capability, but I'll touch on that as we go forward. I think the key message that to take away from FY '24, FY '25 is that we're holding our guidance that we put into the market earlier. The underlying EBITDA of $11 million to $12 million, revenue of $154 million to $160 million, for us, these are our key goals. As we grow in, as we come out of the restructured year, we've put a bow on the restructure. We look to stabilize clear understanding of who we want to be over the next couple of years. And these interim goals around achieving our EBITDA targets are absolutely fundamental to our success. Next slide, please. So again, the 2 key acquisitions that we've touched on, Infotrust. Infotrust really enabled us to leverage the capabilities of our Security Operations Center in Brisbane. So historically, we had a Cyber Security business, Intalock, that was contributing approximately $2 million in EBITDA, and a strong customer base, but was underrepresented in key markets of Sydney and Melbourne. It was really primarily based around the Security Operations Center and didn't have strength in [ GIC ], in assurance, in product engineering to the same degree that we wanted to achieve in our process and our strategic intent to create an end-to-end Cyber Security capability. So this first acquisition, on a number of fronts, it was very complementary from a product and service perspective. It brought in some senior leadership with a lot of industry experience, with Simon McKay taking on the role of CEO, strong operations, a strong presence in Sydney, and has reinforced our capabilities in Melbourne, which is an area we will look to grow over the 12 to 24 months. So key benefit to the acquisition, it's going to enable us to improve our gross margins. It's brought in 450 new customers, which will enable us to do cross-sell. At the time of acquisition, there were only 5 customers of overlap. Of the 650 customers, we've only had 1 that said we can't work with a larger organization. So from that sense, a very strong message. We've rebranded the business from the Cyber segment to be Infotrust, again, very well received by our customers and our staff. And we go into FY '25 with a huge amount of energy across the business from the expanded team. Turn to the next, acquisition. The next slide, Forensic IT. So we've recently completed Forensic IT. This brought in very new capability for us in the space of incident response and digital forensics. So Forensic IT, a very highly regarded organization, small and very niche in what they do. FY '24, they did 182 incident response resolutions for clients that have been breached, providing a lot of services to midsized organizations across Australia in this space. We saw it as very complementary. Clearly, going through a cyber breach is a very stressful time for an organization. But once the dust has settled, we see the key question being, why did it happen? What can we do to ensure that doesn't happen again? And that's enabling us to wrap the Infotrust services around those customers. They've already been in the family for a couple of months. But we've already seen 4 key opportunities come out of that, and 1 very significant opportunity come out for our Managed Service organization to lean into. So we see this as a key capability that distinguishes us in the cyber market, something that not many sovereign firms are able to deliver, and also something that will provide us with significant synergies as we integrate them into our business and also as we look to help the organizations in a post remediation to extend what they do. So I think as clearly, we've leaned very heavily into the cybersecurity sector. We see this as a significant growth opportunity for us to continue to grow. We see it as a market that's still expanding. Other parts of our business have experienced pressure, delays with clients pushing out orders, delaying investment opportunities. This is not something we're experiencing. The cyber sector, as we see, clients, boards still saying it's our #1 risk area, and we're continuing to invest strongly in that. So as an organization, we will continue to invest, mature our practices, mature the way we work with clients. And now we have a much deeper set of offers that we can take to our 2,000 customers, 650 of which are already in cyber, already working with our outside team. Next slide, how that folds out in the numbers, it's very clear. You can see that from FY '23, Cyber Security was 12% of the underlying EBITDA. That will shift to 54%. The clear numbers there, Managed Services, which had been a drag in FY '23 and a drag into FY '24. It's reduced from negative 26% to a small positive number there. And our Communication and Collaboration team, which had been the -- really the engine house of our cash generation and growth, representing just under half of the business, still absolutely a key part of the business and generating revenue and profitability to support the business at this stage. Strong structural tailwinds. We see the Collaboration and Communication team taking new office to market, continuing to benefit from organizations, sort of moving from on-premises to cloud communication. Managed Services, coming out of their restructure and really starting to go to market with some key security-based managed service offers. And I think we've talked quite comprehensively on the Cyber team, so I won't go there. But you can see the clear trend across that period of stop the hemorrhaging of cash in Managed Services and focus on the 2 areas that are building out and have strong tailwinds. Next slide, please. So looking at that, where are our growth pillars coming from? There are 2 key areas. Our organic growth will come from cross-sell. The Infotrust acquisition brought in 450 new customers to the organization. Many of those have a very strong relationship with Infotrust. I feel confident in the services they're delivering and have not been sold Managed Services to the same degree in the past. So we see that as a key offer. We did have, as noted earlier in the slide, some of our largest wins, with combined security and managed service offers in Q4 last year. And we continue to see our pipeline building up in that space. So that unique offer, whether it's 50% or 60% Cyber Security services with a big element of secure Managed Services bolted into that. Partnerships, I've touched on briefly, the dealer network. These things take time to get up and run at full tempo, but we see a lot of opportunity there to onboard new customers through our dealer program and directly through the Communication and Collaboration sales team. They continue to take the group Cisco, the product, the relationship they have with Cisco and are achieving customer acquisitions of 300 to 400 new customers a month. So they continue to grow very well for us. Expanding the offers. Certainly, in the Cyber Security domain, we've expanded the number of offers that we can deliver from our Security Operations Center as a managed service. We've expanded our offer now to include some tools and services around AI and detecting where there's IP leakage for organizations there, as more organizations adopt that tools and technology, but also equally ask what are the risks associated with adopting that. So we're evolving our services to make that. And I think inorganic growth will play a key part over the next couple of years. We've invested very heavily over the last 2 years in technical platforms to be able to integrate well. I know that's something historically wasn't achieved. Well, but we've really put a lot of effort in, and we've had a good experience. And the team has matured around the integration of the 2 acquisitions that we've done today, but inorganic growth will need to play a key role as we move forward into '25 and '26. Next slide, please. So whilst waiting for the final slide, I think the key message coming away from today is that we are holding our underlying EBITDA guidance at $11 million to $12 million. And I've had a lot of questions, as you'd expect that, that is a big step up from $1.7 million that we've achieved in the current year. Where does it come from? And are you confident? I think the answer is yes. We are confident. You can see it clearly comes in from increased EBITDA from the Cyber Security team through the full year contribution of Infotrust and partly a contribution of Forensic IT. Our Managed Services, it's reducing its loss there, so contributing a modest profitability across the year, but the big change is that it's not losing money. And then you'll see Communication and Collaboration starting to grow back as their market strengthens and some additional corporate costs that we have as we're scaling there. But clearly, you can see the 2 key drivers to the material uplift in EBITDA over the year, Cyber Security and Managed Services not losing money. So I think they are the core pillars that give us some degree of confidence to hold our rev guidance across the year. And the year-to-date to the end of October is -- the results we've had is also giving us confidence to hold our guidance where it is currently set. So I think that's the key areas that I wanted to cover in my presentation. I'm happy to take questions. I'm happy to receive e-mails or phone calls and take questions directly as well.

Thanks, Julian. Before we begin the formal business today, we will address any questions that shareholders may have on the operations or the business in general. And shareholders are now invited to ask general questions related to the operations of the business.

Thanks, James. So we've got a few questions just coming through. Does the company have plans to resume quarterly reporting?

Yes, it does. I think we will start to do quarterly reporting after the half results come out next year. And quarterly updates, so I think.

Thanks, Julian. This is a general comment around keep up the outstanding work, Julian. Also, another question that's come through. Have there been any material proxy protest votes on any of today's resolutions? And will you disclose the proxies to the ASX, along with the formal addresses ahead of next year's AGM? Also, as a growing successful company, please offer a hybrid AGM next year as virtual is not regarded as good governance from accounting -- accountability point of view. So an overarching comment there. But the question is being, have there any material proxy votes on today's resolutions? And will those be disclosed to the ASX, along with the formal addresses?

Well, they'll be disclosed during the process -- formal business today, and that will be announced to the ASX as part of the release. In terms of the hybrid meeting, you can take that back on Board. Initially, our shareholders really love the virtual hybrid -- sorry, virtual meeting because they can attend from around Australia. But we'll certainly take that to the Board.

Thanks, James. Another question has come through. The 5 most valuable USB tech stocks: Microsoft, Apple, Amazon, Alphabet and NVIDIA, together with more than $20 billion -- $20 trillion, sorry, largely because they have enormous pricing power and not overcharging customers the world over. Could the CEO comment on which of the big global technology companies we are most reliant on? And what would we do if they suddenly put their prices up by 30%?

So a lot of that, at least, we are most reliant on Microsoft there. So our 2 most significant partners, and one of them is not on that list, which is Cisco. But our 2 largest by relationship and by dollar value spend are Microsoft and Cisco across the organization. If Microsoft were to put their prices up by 30% across the board, we would put our prices up by 30%. And I think it's one of those things where Microsoft has a monopoly position in a lot of the areas. Their paying customers are very happy with what they do. We would follow suit as much as we could. And we don't really have any material exposure to those other organizations that were mentioned in the question.

Thanks, Julian. The next question, which, I think, actually forms a part of today's formal business. There's just a note here just around it's been embarrassing that our shares are trading just at $0.062 when we have a market capitalization of $104 million. Do we really need to have 1.7 billion shares on issue. This is the same as the Commonwealth Bank, with 1.7 billion shares on issue and far more than CSL with 489 million. Will the Board consider bringing a 10-for-1 consolidation to the vote at next year's AGM? But obviously, yes, we're going to.

Get that vote today.

Yes. Yes.

And it'll be in the formal business.

James, thank you. All right. So that was -- no other question at this time on general business. James?

Thanks, guys. Okay. So as there's no further questions, we'll move on to the formal business of today's meeting. All resolutions are to be considered by way of a poll being conducted at the end of the last item of business. I'll just hand it back to Stefan, who will just outline the question and voting perceptive today.

Thanks, James. So as mentioned earlier, shareholders will be able to participate, ask questions and cast direct votes at the appropriate time whilst the meeting is in progress. Visitors and media are reminded that whilst we welcome you at this meeting, it is a shareholder meeting, and you may not make comments or ask questions. We may experience some time lag, and this may cause some delay in your text questions or comments coming to our attention. We encourage you to lodge them as early as you can. Shareholders wishing to ask questions by text, please take note of the following instructions. Please select the Q&A icon located at the bottom of your screen. Type your questions in the Ask a Question box and press the Send arrow, and your questions will be addressed at the appropriate time. Shareholders wishing to speak and ask a question, an audio questions facility is available during this meeting, and please follow this process. Please select the Raise Hand icon located at the bottom of your screen. You'll be placed in the queue and authorized to speak when we reach the Q&A session. Before asking your question, please state your full name and who you are representing. Regarding voting on today's resolutions, all shareholders, proxy holders and authorized corporate representatives and attorneys of shareholders who are entitled to vote will be able to do so via the webinar poll. It is important to note that if you have lodged your proxy form and voted prior to this meeting, you do not need to vote again at this meeting, unless you wish to change your proxy instruction. For those proxy holders, shareholders and authorized corporate representatives who have not yet voted prior to the meeting, please cast your votes on each of the resolutions when the poll is opened. For proxy holders, you will have a summary of proxy votes, which detail the voting instructions, if any, for the items of business. By completing the voting via the webinar poll when instructed to vote in a particular manner, you are deemed to have voted in accordance with those instructions. When the Chair has been appointed proxy on behalf of the shareholder, James Joughin, as Chair of this meeting, intends to be voting these in favor of all the resolutions. When the poll is declared open, a poll window will appear. To vote, simply select the direction in which you would like to cast your vote. The selected option will be marked. To submit your vote, simply click on the Submit button. You will have the ability to change your vote up until the time voting is closed. Thanks, James.

Okay. If you have a question on the items of business, please follow the question process, which was outlined by Stefan. We will now address all the questions on resolutions after the filed resolution has been put to the meeting. Before I open the poll, I wish to remind shareholders that the poll will remain open for additional time after we have considered all resolutions. We'll now open the poll for shareholders, proxy holders and authorized corporate representatives, and you may now cast your votes as and when the resolutions are being addressed. I now declare the poll open. [Voting]

I refer to the first item business that's set out in the Notice of Meeting. The first item of business pertains to the receipt and consideration of the financial report of the company, together with the director's report and the auditor's report for the year ended 30th of June 2024. These items are contained in the annual report, so I will ask that they be taken as read. The annual report is available on the ASX announcement platform or on the company's website. The Corporations Act requires accounts and reports to be laid before shareholders at the Annual General Meeting. However, except as set out in Resolution 1, to be considered later, there is no requirement through a vote of the members to be taken on them. No written questions to the auditor under Section 250PA of the Corporations Act were received by the cutoff date, 5 days before this meeting. Questions may be directed through myself or to the auditor in relation to the conduct of the audit, the audit report, the company's accounting policies or the independence of the auditor. As this matter does not require a vote, we will now move on to the first resolution. I now refer to Resolution 1, which pertains to the adoption of remuneration report, which forms part of the director's report for the financial year ended 30th of June 2024. I now propose that shareholders consider and, if thought fit, pass Resolution 1 as set out in the Notice of Meeting and as displayed on your screen. The remuneration report is set out in the directors' report in the company's 2024 annual report. The remuneration report sets out the company's remuneration arrangements for the directors and key management personnel of the company. The vote on this resolution is advisory only and does not bind the directors or the company. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that the shareholder consider and, if thought fit, pass the ordinary resolution. Move to Resolution 2. Resolution 2 pertains to the election of Shan Kanji as a director of the company. I now propose that shareholders consider and, if thought fit, pass Resolution 2 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 3. Resolution 3 pertains to the election of Simon McKay as a Director of the company. I now propose that shareholders consider and, if thought fit, pass Resolution 3 as set out in the Notice of Meeting and is displayed on the screen. With respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 4. Resolution 4 pertains to the election of Dane Meah as a Director of the company. I now propose that shareholders consider and, if thought fit, pass Resolution 4 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 5. Resolution 5 pertains to the election of Russell Baskerville as the Director of the company. I now propose that shareholders consider and, if thought fit, pass Resolution 5 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 6. Resolution 6 pertains to the ratification of the prior issue of 37,735,850 shares. I now propose that shareholders consider and, if thought fit, pass Resolution 6 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders to consider and, if thought fit, pass the ordinary resolution. Resolution 7. Resolution 7 pertains to the ratification of the prior issue of 26,931,493 shares. I now propose that shareholders consider and, if thought fit, pass Resolution 7 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 8. Resolution 8 pertains to the ratification of prior issue of 26,666,664 unlisted options. I now propose that shareholders consider and, if thought fit, pass Resolution 8 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 9. Resolution 9 pertains to the ratification of the prior issue of 12,195,116 unlisted options. I now propose shareholders to consider and, if thought fit, pass Resolution 9 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 10. Resolution 10 pertains to the approval to grant FY '25 performance rights to Julian Challingsworth or his nominee. I now propose that shareholders consider and, if thought fit, pass Resolution 10 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 11. Resolution 11 pertains to the approval of loan funded share plan. I now propose that shareholders consider and, if thought fit, pass Resolution 11 as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that the shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 12. Resolution 12 pertains to the approval of loan to the Managing Director. I propose that shareholders consider and, if thought fit, pass Resolution 12 as set out in the Notice of Meeting and is displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 13. Resolution 13 pertains to the renewal of the employee incentive plan. I now propose that shareholders consider and, if thought fit, pass the Resolution 13 as set out in the Notice of Meeting and as displayed on the screen. In respect of this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 14. Resolution 14 pertains to the consolidation of share capital. I now propose shareholders consider and, if thought fit, pass Resolution 14 as set out in the Notice of Meeting and as displayed on the screen. In respect on this item of business, the following proxies have been received as outlined in the presentation. I move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 15 and the final resolution. Resolution 15 pertains to the approval of the 10% placement facility. I now propose that shareholders consider and, if though fit, pass Resolution 15 as a special resolution as set out in the Notice of Meeting and as displayed on the screen. In respect to this item of business, the following proxies have been received as outlined in the presentation. As this resolution is a special resolution, it requires 75% of votes cast in favor to be deemed as passed. I move that shareholders consider and, if thought fit, pass this special resolution. Thank for your patience across all those resolutions. We'll now go to shareholders' questions. Does any shareholder have any questions on any of the items of business today?

Thanks, James. Just a couple of questions have come through. This one is on the 10% placement facility resolution. There have been many substantial protest votes against resolutions like this during the current AGM season as it's not good practice to allow the Board to selectively place up to 25% of the company shares to anyone over a 12-month period, diluting the existing shareholders about compensation for their lost property rights. Why are we asking for this authority? And has there been a substantial protest vote against this resolution? Placements favor big end-of-town investors at the expense of retail. And even when retail are offered an SPP, the vast majority don't participate. When next raising capital, will you consider doing a pro rata renounceable, which is the fairest method for all shareholders?

There's a lot to unpack in that question. The first thing is that, as a micro cap company, having the ability to move quickly and placements is a real benefit for us to undertake acquisitions or other capital that we need. Secondly, I mean, as I'm retiring from the Board today, I mean, it will be a new Board decision on the best method of determining to raise capital. But certainly, we are well aware that we want to maintain and encourage the wider shareholding and not just institutional shareholding. So it's certainly on the Board agenda.

Okay. Thank you, James. And the last question just relates to the Simon McKay election resolution. As a new shareholder, I'm not up to speed with the connections and history between our major shareholders, directors and executives. Could the Chair please briefly summarize who are the major shareholders? How many of them are associated with our directors or senior executives? Who are completely independent directors, representing us, small retail shareholders? Which of the majority shareholders have no affiliation with management or the Board?

So to answer that question holistically, we're -- a director is an executive director that are in the business. And the acquisitions we've undertaken, Simon McKay is -- was a vendor of the Infotrust business, so he is a related party in that sense. So -- what was the other part of the question?

Yes. So who are the major shareholders, directors and executives and the history between?

Well, as I kind of indicated early in the presentation, Mr. Shan Kanji is a major shareholder here today. And the other directors do have shares in the company in various numbers and being aligned with shareholders.

Okay. That is everything on formal business questions, James, received today. Thank you.

Thank you. Well, all, thank you. This concludes our Q&A session for this meeting. As mentioned earlier, all voting today will be conducted by way of a poll on all resolutions, noting the poll was opened earlier in the meeting. We'll now provide shareholders with additional time for poll voting to be completed. So we'll pause while voting is being undertaken, if not already done.

Thanks, James. So we'll just allow another 20 seconds or so to just complete your poll voting, if you haven't done so already. Okay. Back to you, James, to close the poll.

If you require further time to complete the poll, please indicate by raising your virtual hand. I just want to make sure everybody has had the opportunity.

No further indications. Thanks, James.

There's been no request for additional time. I now declare the poll closed. Once the poll results have been processed, we will announce the results later today on the ASX market announcements platform. So ladies and gentlemen, that concludes the formal part of the meeting. Since the meeting has not received any notice of other business, I declare the meeting closed. And again, I just want to thank you for your attendance. And I will be departing the Board today, which is a long-established part of my life, and I'm looking forward to watching on to the other directors and shareholders moving the company forward. So thank you for your continued support.

Thanks, James.

Thank you.

Thanks, everyone. We'll now close the webinar. Thanks for your attendance.