Infratil Limited (IFT) Earnings Call Transcript & Summary

Good morning everyone. My name is Mark Flesher. For those that don't know me, I'm with the Morrison & Co Infratil team, and I look after the Investor Relations. So with a big team around us in terms of able to put on today. So for those of you who joined us last night, thank you, it was a fun evening. And I'm pleased we've had so many people turn up this morning. So knowing some ahead rather late night. So anyway, I get to -- just through the housekeeping to start with. Again, I had some helpful hints from Bogoievski. He said to me, you're going to do your thing and I say, what's the thing? I said, you know, do the thing about toilets and volcanos. So evacuation is -- the doors will open here, we'll go outside either outside the [Indiscernible] or on to the grass, toilets are down the middle, my advice to Bogoievski if there's a volcano eruption not to be on the toilet. So that's my racing event for today. The presentations for today are up on our website and have been released from the New Zealand Stock Exchange. We are videoing today. So we will ask when we get to Q&A, if we could -- if you could use a mic. It isn't being webcast live this year. We thought it was nice to have them here in person, which so thank you for joining us. And those videos will go up on our website from Monday. So I think there's a WiFi guest's pass on the wall there for those who want to use it. And I think I get to wrangle the speakers today a little bit on -- they've got a big clock here that says when their time is up. But we will look to do Q&A as we go through each session, and we'd welcome obviously any questions. So -- that's it for me. I'd like to -- it's my pleasure to welcome Alison the Chair of Infratil to kick us off.

Thank you. [Foreign Language]. So I'm Alison Gerry, I'm the Chair of Infratil and I'd like to welcome you to the first in-person Investor Day since 2019. We became very used to delivering our financial results and the Investor Day virtually. But it's just actually so nice to be back here in person. But the team does assure me that even though it is lovely to be here and sometimes it's a bit awkward standing up in front of a crowd, it is much easier than talking to the camera for long periods of time. So I'm sure that you'll agree that having interactive sessions is going to be fantastic, and we have lots of people here today from Infratil from Morrison & Co and from our portfolio entities. And that's really going to add to the energy for the day. Today, we've got execs from CDC Data Centres, Longroad Energy, Manawa, Qscan, RHCNZ Medical Imaging, Vodafone and Wellington Airport. And so take the opportunity to catch up with some of them. Everyone has got a name tag. So I really encourage you to meet some of the team. And as Mark said, it was great to see most of you at the investor dinner last night, a fantastic venue and everyone said to me, I think, is going to go back to listening to choirs because they were just absolutely outstanding. We enjoyed seeing the Prime Minister, Chris Hipkins, and he was very generous of his time and did quite a number of Q&A. He's also got fantastic hearing because I certainly couldn't hear most of the questions from the back of the room. But he did paint a great picture of opportunities and efficiencies that his government is keen to access. So with just 8 weeks into the job, one can only admire the Labor Party's seamless transition of prime ministership. And I imagine New Zealand Rugby Board and taking notes and watching with a little bit of envy. In our first session today, we're going to have Jason and Phillippa, who are going to give us an update on our Infratil portfolio and the outlook ahead and a particular focus of the Infratil Board has been on our portfolio mix, the diversification by geography and sector. Our portfolio was very resilient through the COVID period. And going forward, we just want to make sure we've got the right mix of growth assets and defensive assets to continue to deliver on our long-term target returns to shareholders of 11% to 15%. The team has been doing some detailed modeling of the portfolio to see how it's going to perform over time. And we want to do that because we want to have reasonable certainty that we're going to meet these target returns. But it's going to be no surprise to you that we are still very focused on a number of key sectors that we think offer attractive long-term opportunities that are supported by strong underlying fundamentals. Renewables, digital, health care and airports haven't changed as our key investment sectors, but we are constantly looking within these sectors or within adjacencies and for the next set of opportunities. These may be new ideas that matter or are options that are activated within our existing portfolio. And I think we're going to give you a little bit of color on those today. I know that we've been following closely the challenges in the global banking sector. And I'm just really pleased to be able to report to you that capital management and treasury activities have long been a focus for the Infratil Board. We've got a strong internal team that are focused on ensuring that we've got the right levels of liquidity, including cash balances and undrawn facilities. We've got long-standing and strong relationships with high-rated lenders. Some of you are here today, so welcome. And we have our very long-running mature and consistent retail bond program. So together, those elements, give the board comfort that we'll be able to face any uncertainties that do arise and importantly, set us up to respond if we do see some interesting opportunities appear. Over the last 2 years, while we've been not seeing you face-to-face, we've actually had a number of people changes, both at Infratil and the manager. So Jason has become our food CEO in 29 years. Paul Newfield became CEO at Morrison & Co and is only the third CEO. At Infratil we're not quite as good. We're -- I'm the fourth chair, and I succeeded Mark Tume last May. And we had 2 new Infratil directors joining us, Andrew Clark, who's here in the audience today and also Anne Urlwin. Andrew joined the last June. He is Melbourne-based and has recently retired as a senior partner at BCG; and Urlwin, a very well-known New Zealand Director joined us last December and Anne is now the Chair of the Audit and Risk Committee. However, despite these people changes, as you would expect, Infratil's active approach to investment and ideas that matter is unchanged. I'm also really pleased to be able to tell you that our relationship with the manager, Morrison & Co is very healthy. There's always healthy tension, but we think they continue to perform very strongly. And we're excited to see the investment that Morrison & Co has made in its global team as the nature of our symbiotic relationship means that for Infratil to continue to grow and expand geographically so to must our manager. One area I wanted to mention that we're probably not going to discuss too much today is Infratil's commitment to sustainability. While sustainability is integral to our strategy, portfolio and investment management, we recognize the need to be more articulate in how we are going to communicate this externally. A great example of this progress is that Infratil together with Morrison & Co recently committed to seeking science-based emission reduction targets. Proceeding and achieving these targets won't be easy, and it's going to require a great deal of collaboration and engagement with our portfolio entities. But given our global footprint and scale, we think that Infratil's got a real opportunity to make a positive difference as well as being a market leader in sustainable infrastructure investment. So lastly, I'm just going to set out a little bit of how the day might work. As I said before, we're going to start with an update on the portfolio from Jason and Phillippa. We're then going to focus on our health care platform. We'll hear from Rachel Drew and Michael Brook from Morrison & Co, who will be followed by Chris Munday, CEO of Qscan; and Terry McLaughlin, CEO from our RHCNZ Medical Imaging business. I've said to Terry, it's quite a long name to say, and we may work on that. And after the break, we will move to renewables to hear from Morrison & Co Energy experts, Vimal Vallabh and Deion Campbell with our CEO of Longroad Energy, Paul Gaynor, leading us into the lunch break. After lunch, we're going to have a manager update from Paul Newfield before finishing the day with a focus on digital infrastructure and connectivity, first hearing from Lewis Bailey from Morrison & Co and from Greg Boorer, our CEO of CDC Data Centres; and lastly, from Jason Paris, CEO, Vodafone. And finally, if we are on time around quarter to 3, Jason, our Jason is going to wrap up the day. So [Foreign Language] Have a great day.

Thanks, Alison. [Foreign Language]. Great to see everybody. I just took a photo of you before, you look amazing. Well done. But thank you, Alison. I think it's great you make yourself available to do these things. And I think you've continued a great tradition of being available to everyone here to see that the Board is active. And I 100% agree, the relationship is really strong, right, but it is a constructive relationship. So I was going to do a bit of an intro this morning, to try and set the day up. So really, this is almost the only chance you guys will get to interact directly with particularly our CEOs and management teams and that's not just through the Q&A and the sections, right, but you should definitely take advantage of -- the gets during the day around lunch, if you didn't already last night to talk directly to them and see if what I tell you during the presentation matches with what they tell you today. So my job, I think, really is just to lay the framework for those sorts of discussions. And then I'll come back at the end of the day and try wrap up anything you didn't feel was quite addressed and do it that way. With that, let's get started. There's a pretty familiar setup now we open all our presentations with this kind of Infratil on a page. The things that are interesting on here to me are how much investment we got done last year, and I don't think that's really slowing down. So remember, we calculate that, that's the $1 billion you've got there on the slide. We calculate that on a proportionate basis for Infratil and really speaks to a lot of the theme you'll hear today, which is that the platforms that we've built and the positions we've got ourselves into give us a heck of a lot of options to continue to invest internally and attractive opportunities. So hold that thought, I'll come back to updated guidance as well. Next is another familiar setup slide. This is really the Infratil model and has been that way for a number of years, certainly for as long as I can remember. It speaks to what our definition of infrastructure is, which is quite broad, but still actually reasonably clear certain in our heads that it needs to have defensive characteristics exposed to long-term trends and be capable of taking further and further reinvestment that thing may mention at the outset. Not that has changed and it feels like it will stand us in good stead in the future. It's really cool doing this slide. I'd enjoy it. Looking at back what we said last year in this forum and seeing what we actually got done. I mean the big things last year were obviously the Longroad investment process, where MEAG joined us in that platform. And we said we were going to look at that at the start of last year. Also, we said last year, we were assessing capital release options for Vodafone, which was our way of saying we would look at selling the towers, which we completed as well. So 2 big things done last year and, I think, pretty material for the portfolio. We talked last year in the health care section, which you'll hear more from them in a second about looking quite actively at building out in Australia because remember, last year, we had finished building out our national footprint in New Zealand, which is a pretty key strategic move. And we talked about looking at teleradiology and adjacent health care businesses, I think we might have called that cancer care. Actually, the way the year turned out, we experienced more -- or longer headwinds, I think, in that space than we anticipated at the start of the year. We found it more difficult to find bolt-ons, I guess, for that business at attractive valuations. Valuations have been quite high in that space. And so we really only made one small move, which was buying Envision, which we thought was a good move and a good value. And it's kind of a similar theme in the adjacent health care businesses sector. The ones we looked at were too expensive for what we thought was value in the space. So we were active on those things, but nothing really came off. We did look a lot at teleradiology though, and you'll hear more about that in the future. It does look at like an incredibly attractive idea and some of the things we're doing today are not necessarily diving into that space, but getting ourselves set to have that option in the future. It looks really interesting, in particular, for stretching beyond New Zealand and we have evaluated a number of markets offshore, which you might hear a little bit about from later [Indiscernible]. So quite a lot of work in that space, but really the right thing, it felt like to do last year was watch and wait a little more on these bolt-ons and do some of the prep work for some of the longer-term strategic goals we've got in mind there. The things we said last year, actually that is quite amusing to look at again, we had room to add more core cash-generating assets. And I've got a couple of charts later on to show you why we thought that and why we think we're sitting there. So that's probably not a major priority today. And the thing we really didn't get done was the RetireAustralia strategic review. We obviously ran that, spent quite a lot of time working on it. In the end, it wasn't the right thing to do. And we're happy to be holding that, and that business is moving into its next phase, which I'll talk about in a second as well. The other thing where we didn't get tangible results yet, but we're still very active on. We've talked actually all of last year about continuing to assess attractive investment opportunities in the data centre and connectivity space. And I'll talk a bit more about that, too, but that still feels like a high-priority task and quite attractive. So let's have a look at the portfolio did over the year. So this is what we showed you last year, quite -- quite a big overweight in digital. That's come down about and you see renewables stepping up to actually a -- closer to what I think it ought to be in the portfolio, and that's now 1/4 of the portfolio. A lot of that has the effect of the Longroad transaction and really speaks to the kind of embedded ability in the smaller platforms there to -- through some processes like this or tailwinds hitting them or just as they mature to become a much more relevant part of the portfolio and to deal with the strong positions we have in digital to try and keep the portfolio more and more diversified. You'll see FortySouth on there now. Much of our investment in the towers business, you'll see, Jason, we've got your new brand on there. And Deion will be talking about Mint later on as well, which is the new member of the family. So we feel quite good about that mix, and it speaks to the focus areas that we've talked about for a long time. Another interesting -- our view of the portfolio is this just seeing the global diversity we're starting to introduce, and that should increase in percentage terms in the portfolio as well, right, as Galileo reaches, we hope, an inflection point like Longroad has and potentially Gurin in the future as well. And you'll hear from Paul later on about how Morrison & Co is investing ahead of Infratil's needs to make sure we've got the capability we need in those markets as the portfolio grows there. On sustainability, which Alison mentioned, we're continuing to update you on this as we make progress, and I don't know if Louise and her team are here. Louise, I know you've been incredibly active in this space for us. The big news that we released earlier in the year was that Infratil and Morrison & Co have become one of the first, not quite the first by almost today to sign up as a financial institution to science-based targets initiative, which will mean that across our portfolio, all of our portfolio entities over time will need to sign up to emissions reduction targets that will be validated by the science-based targets initiative, which means there will be aligned to the 1.5 degree goals that seem almost impossible now, but certainly from -- as a globe, but certainly from an individual company perspective, it's very clear, I think actually what those individual companies will need to do to at least get themselves sorted for those initiatives. So we have our first sustainability report coming later this year. And then pretty much straight after that, I think we'll be able to start publishing exactly where the targets are going to be and over what time frame they are for our companies. And I know certainly all the major ones who are well established already well on their path to doing that themselves. And then our job is for some of the smaller companies who are maturing and getting it up to get them on the path as well. And it will actually become a lot easier once we do the first of those because we'll have a really good template for the new ones as well. So we're pretty proud of that progress, and you'll hear more on that later on. This is a pretty traditional graph. And Alison spoke about it before, how we go about blending higher and lower risk assets to achieve our target return. This is a graph we've been showing for a while. And what the team have done this year, is relook at how we cut the portfolio and present it to you as split between those risk return ranges, we call them core+ and value-add and development. What we've gone and done is break down our valuation models for those businesses and actually pull a plant, something like Creek's business at CDC into the highly contracted core part of the business and put that in blue and under construction, say, data centres and put that in the purple. And then the future build, we've put that in the yellow. And actually, when you run that theme across actually all of our businesses, it works. And when you look at the target equity return for those grades of risk, it works and more or less falls in line with that. And what it tells us is that actually in the highly contracted, highly reliable parts of the business, we are quite well set as a portfolio. I think last year, when we showed this graph, when we were doing it the old way we used to do it, it might have had about 35% or something in that category, which is where that comment about having room to add to that came from. But now actually, we feel quite set in that. I think there's still a little bit more work to do on the border between sort of blue and purple and yellow and purple, if you like that purple and the core+ value add feels slightly too narrow to me, but it does also speak to how we're generating our returns, which is very much a steady state business like Creek's contracted data centres, blended with areas where we can apply more capital like building new data centres where we see still quite attractive returns on capital that fit within the ranges that we've always talked about in the past. And that obviously takes a lot of our focus, making sure their portfolio and our teams and our strategy has pointed at areas where we think we can still make returns on capital in that 15% to 25% range and we feel really good that we are doing that. So have a look at that. We'll update that again on when we release the full year results and we might talk about how those things move, if you flick the calculation for [Indiscernible] inflation or interest rates to give you a little bit more insight into how that all builds into our target return. So that's kind of where we are and where we've been. I wanted to say a few things about where we think we're heading. This is kind of an interesting graph. I mean the macro environment, I think, is clear to everybody, and that it is unclear. And there are many people in this room who could speak to better than I could. But certainly, volatility through interest rates, the likelihood that inflation and both inflation industry rates are higher for longer is our reality. And in theory, that should support infrastructure investment, right, as real assets with strong inflation protection relative to other assets. In reality, this year, I would say, listed infrastructure has been a little bit disappointing. It's tended to trade with bonds, right? And its team did not to necessarily look like it was doing the job infrastructure is supposed to do. But I think that's obviously relative to everything else. And certainly, in private markets, that characteristic of infrastructure resonates incredibly strongly and resulted last year. It's a little hard to say. If you look at the last 4 bar graphs, I think that adds up to about $170 billion. That's how much money was raised for infrastructure funds in 2022 because everybody was seeing that theme. That was a record year for Infratil, I think for the first year for exceeded private real estate funds still behind PE, obviously. But a monster year for infrastructure fundraising, which is nice if you're looking to sell assets but harder if you're looking to invest right because that means more competition. A really interesting thing we've noticed is that in the second half of last year, really that fundraising fell off a cliff right and that's those last 2 grades. So it is definitely decelerating, I think, in the amount of money that's available free to allocate to infrastructure. We don't necessarily know why, but it's a fact. So -- but deal numbers, which is the graph on the right, seem to be holding up, but our experience of deal processes is a bit different from what that graph says. Processes definitely feel like they're taking longer and a lot -- and it's for any number of reasons. You have investment committees who are worried about all sorts of different things in their portfolio, but everybody is worrying about something. And you just need one reason to mean that person pulls out and suddenly, you don't have sales processes with 5 or 6 people when being driven to 8-week accelerated DD time lines so much anymore for a bunch of assets, which means we feel actually that we could be entering that period we've talked about for a while since a lot of this disruption started, where there might be opportunities that emerge to get assets that fit our portfolio or that we really like the look of for the future at prices that don't feel crazy at all and could be quite interesting. Unlike, say, the health care theme I talked about earlier on. Paul might talk about that a little bit more as well. So with that backdrop, how are we thinking about how the portfolio evolves over this year and kind of longer term. One that start with digital infrastructure. I think the first point that we want to make for both digital and renewables is that the platforms we've got give us really great opportunities to either benefit from or invest either through those businesses or outside of them into the future trends that are shaping those areas and that will provide attractive investment opportunities in the future. And I think your job today is in the setups for those renewables and digital sessions is to listen out for the areas that those businesses are thinking about for the future. So we feel really good that we don't need to compete in the open market to access AI or the computing requirements for augmented reality and virtual reality or edge computing or quantum computing, actually, within our stable already, we have great access points to those things, and there are a unique characteristics of the businesses we have and the teams that we have that give us really good access to those ideas in the future, and we can talk about that as long as you like. But I put a couple on here to give you a feel for. So that is the #1 message. We also learned through the year, as we've thought a lot about this, looked a lot around the world, as I mentioned earlier, for data centre and connectivity opportunities that a bunch of the things that we do within our businesses are not necessarily done the same way elsewhere in the world. And we think -- means our capability can translate into other markets. The way Greg and his team provision their data centres isn't the way it's done elsewhere in the world. And actually, the way they do it is quite well suited to the way data centres will need to be architected and built in the future for some of these new computing use cases as an example. So we feel positive about that. And the market environment to address some of these things feels like it could be hitting our way as well. On renewables, it's a very similar story. The one addition I would say to that, though, is and Paul is going to talk to this as well, right, as we transacted, our transaction with MEAG before the Inflation Reduction Act almost take a week before. I think it was something crazy like that. And that has supercharged the industry in ways we never expected. To us, that means that the stronger outlook from that Inflation Reduction Act is definitely not reflected in valuations of Longroad and that's our job to explain to you a little bit today and during the year what that actually means. But that -- we feel really positive about that. As I mentioned before, this platform like the others are giving us ways of accessing future important technologies and themes in that sector. So you'll hear from Paul today about an early investment we've made in our business that produces hydrogen for public transport and vehicles, [Indiscernible] vehicles in California, for example, which will be a key technology, will be a key theme. They're doing it at incredibly attractive returns probably in one of the more attractive markets in the world. To do that, and we can do that through Longroad, through their connections with people on the ground who can monitor that investment. But the benefits of that can spread throughout the group. I think it's pretty exciting. Galileo, I think we were in Zurich last week, we had our annual strategy session with the team. They feel to me like they're set to demonstrate their potential. They've got their first set of projects in the market for sale this year. The market has moved very much to selling projects before financial close now because there's so much demand for projects and utilities and others are snapping up these projects at incredibly attractive returns. So even though we have switched to a greenfield development strategy, which would typically be longer, they look to me to be set to demonstrate how that can make money, how that can turn back through Galileo itself and return to shareholders. Europe itself is developing its own response to the Inflation Reduction Act. They do it a slightly different way there, which is a lot slow through sort of direct allocation through auctions and tariff regimes. But that will all be a tailwind for that business, and it feels really well set now after quite a difficult time building that team initially through COVID. We feel positive about that. And so you add to that Gurin, add to that Mint, add to that Manawa, we think we're well placed through the portfolio to address all the kind of future or next-generation renewable energy technologies that will come along. I mentioned hydrogen before. We are looking at offshore wind through a couple of those platforms as well, early-stage development. That's going to be a major theme in Europe, but elsewhere as well. And storage is a huge thing that you'll hear about from Paul as well. So those, I think, are the big ones that we think about in terms of future or near term, I should say, reinvestment, investment opportunities at attractive returns. Turning to health care. I think this is the things that we're doing for the future. I mean, we could spend actually all our time and all our capital and make a lot of good returns for everybody in this room by just doing digital and renewables, but we always know we need to develop the next theme for Infratil as areas derisk or change, and that's definitely what we're doing in health care with our diagnostic imaging businesses in particular. We feel really great about the position we've got. We're at scale in ANZ in a way, just about no one else is, very high-quality businesses. In New Zealand, we're the only one with the national offering because of the quick work the team did straight after our initial investment in PIG. And Qscan itself has always been and still is a peak CT leader in Australia, which is so important for high-value diagnostic imaging work. So we like where we are. 2022, as you'll hear, it has been a challenging operating environment. One of the things the team is doing is bringing forward IT and other kind of productivity investments. It's actually quite a good time to be doing that if volumes are down. But -- and other initiatives that should mean we can actually take advantage of the scale that we have, which is impressive and hard for people to replicate. And you'll hear a bit more about that from the team as well. As I said, we're remaining selective on additions. There was a transaction of a business in Sydney that I think was at multiples above our entry into Qscan, which just demonstrates, I think, the valuations of how to hold up there. We don't need more scale at those valuations, but we'll continue to look for the right partners for those businesses at the right time. As I say, teleradiology, the initial what we've done there is actually really attractive still and some of the IT stuff we're doing this year, which we would do anyway will set us up to address that in the future as well. And we continue to look at -- we should pay -- Jason [Indiscernible] actually use it with quite a lot, but things that can grow out of our DI platforms and actually Rachel just going to talk to that. Retirement, I mentioned RetireAustralia. The operating performance are still actually really good. Post strategic review, we're sort of nearly complete on setting the new plan for them and shifting to execution mode. So we look forward to telling you more about that later this year, right, Phil? Wellington Airport, I don't know if the team is still here. Yes, down the road there. [Indiscernible] performed incredibly well as well, well beyond where their budget was set at the start of the year. And obviously, a really interesting pricing and CapEx environment with Auckland going through now and Wellington coming close behind later in the year. So that feels like something we should be updating you more on later in the year as well as we learn where Auckland settles and what we want to do. So it's the only reason these guys aren't up on the stage here today. It's more that we are still mid-flight and actually figuring out what to tell you about those businesses. But they're doing really well. So that's the outlook. I might just do this, Phil, you can stay here. Let me tidy up. So capital availability, this is traditional slide. As anyone who watches us will know, we still have really good capital availability for our internal ideas and also anything externally we might want to do. That's obviously been topped up. I think, since a few [Indiscernible] because of the Vodafone tower sales proceeds rates is the main change you'll be seeing on there. There's not too many maturities coming that would worry us as well. We have narrowed guidance. Now that we're about 3 days away from 31 March, right? So we should know pretty closely what we're going to do. We're here at $520 million, $530 million. I think we've taken the top off was $540 million last time, but we're tracking to what I think is a pretty good number given where we guided at the start of the year. You can have a look at that later and ask any questions, too. Happy about that. We're not giving FY '24 guidance yet. I think we'll be doing that in the full years, right? So it's a bit there. Hopefully, that gets the juices flowing in your head for the setup for the decisions to come. I can take a few questions now, Flesh, do you think, but it might be worth taking some of them at the end even once you've heard others. I think the headlines are infrastructure is still a really hot asset class in the environment we're in. But there could be some opportunities emerging in deal processes just because of the volatility we're seeing. We feel like we're in a really strong position with the mix of our portfolio and obviously the balance sheet. And we could just spend all our time in renewables in digital if we want it, but I don't think that's the right thing to do for you all here, and we should be planning seeds for the future, and we are. But the positions we've got give us quite privileged access, I think, to the things that are going to be important in the future, some in the very near term in digital and renewables. We are alert to what's going on. But always, when we're making a new investment, if we do, we'll be pretty disciplined and we've turned down a bunch this year, which I think speaks to that. So I'll finish there. Do we have time for questions? Or yes.

Yes. If anyone has got any [Indiscernible] now. Yes.

[Indiscernible] Yes. I mean, inflation is on 40-year high. You mentioned it briefly. Interest rates have gone from 1.5% in the [Indiscernible]. Just feels that more should have changed in the thinking and what we're hearing, I'm not saying it's about [Indiscernible] just curious, has anything generally changed on your long-term thinking or medium-term thinking around attractive versus less attractive areas, ways to invest?

I think a couple of things probably have. I think the areas of investments still feel really good. I think you've definitely seen us not bundle into options and buy things, right? So I think auction prices are not reflecting those things. And we've been incredibly disciplined and patient on that. And we have prioritized capital to our internal opportunities as a reside, I have to get asked why do you just send every dollar to a Longroad and be done with it all [Indiscernible] as well, obviously. But -- so that has definitely changed. I think when we look at cases now and we look at the use of acquisition debt, we're definitely nowhere near where we would have been 2 or 3 years ago, right? I think the cost of that debt and how long it stays that expensive, it's very uncertain and probably means we're uncompetitive in these options as a result. I think those would probably be the main things in terms of our capital allocation, where I think it has changed. Any other questions for now? Easy? Cool, I'll come back later.

Now I'm looking for my next 2 speakers [Indiscernible]. Short introduction. So Rachel and Mike have -- some of you will know them, but they're long serving Morrison & Co employees and have had a big focus on health care and [Indiscernible], which is obviously a relative new sector for us, but we've been doing a lot of work and years before the investment and both these guys are involved in the actual asset management business as well. So they're going to talk a little bit about sort of how we got to where we are and our thoughts about the sector going forward. So welcome.

[Foreign Language]. Good morning. My name is Michael Brook, and I'm involved, as Jason said, with our Healthcare investments. I'm an Executive Director at Morrison & Co. I've been involved in our health care thinking since as early as 2015 and led Infratil's investment partnerships into Pacific Radiology, Auckland Radiology group and Bay Radiology. I'm a Director of what we call RHCNZ Medical Imaging. It is a bit of a mouthful that one. That's just the parent entity for the 3 New Zealand radiology practices, and I'm a former Director of Qscan as well. So I'm going to briefly cover off some of the elements of our investment thesis as well as an update on some of the sector tailwinds and then few of the short-term headwinds that we're observing from an operating perspective before handing over to my colleague Rachel Drew. And then we've got Terry and Chris who will speak from these specific assets as well. So see if I can get this to work. All right. Look, we covered the why in detail on our way into the investments in Qscan and the New Zealand Radiology practices. We're still fairly early on the journey, but it's worth revisiting. And I'm going to borrow some language from 2 people who are a lot smarter and more articulate than I am. The first is our former Chief Executive, Marko Bogoievski. He's a strong advocate for private capital investment in health care. And we talk about investing in ideas that matter. And he called health care the ultimate idea that matters. And that comment has really stuck with me and has really brought into sharp relief, if you or anyone you know has ever had a health care crisis. The second person I want to paraphrase is Paul Newfield, the Chief Executive of Morrison & Co, and he explains investing ideas that matter really well. And this is something that you're going to hear a lot of from the Morrison & Co team in particular. So we start with considering what are the really big challenges society needs to solve and then finding businesses that are particularly well positioned to meet or help solve that problem. Then we try to keep reinvesting in those businesses. So you also hear the term platform because you reinvest and you grow it over the next few decades. And that thinking really underpins the entire Infratil portfolio. So healthcare clearly is the idea that matters box. As an infrastructure investor, I would then overlay certain characteristics that need to be present to be a good fit for our client capital. We like radiology, we like oncology, in particular, because they tend to exhibit some of these defensive or Infra-like characteristics. We can then continue to deploy capital into these platforms through new machines, building out greenfield clinics, expanding existing clinics and then selective acquisitions. And Jason mentioned we have looked at a lot of things over the past year. I would say it's probably been my busiest year, but we didn't actually execute on much. It's just the way it goes sometimes. It's quite intimidating with the clock there counting me down. I feel like I'm going to explode. Look, of the items listed here, I think the one to elaborate on a little bit is the barriers to entry. Now one of the key barriers in the diagnostic imaging platform is the breadth of clinical expertise we have in the platform. Radiologists are a scarce resource. And then if you think about this in the context of increasing digitization, the scale of our platform means we can invest in the best technology. We can provide state-of-the-art equipment, create the best learning and development opportunities, create leadership opportunities for our doctors, but also make it easier for our doctors to do what they do best, and that's practice medicine. All right. Is there any more? Look, I don't know about you, but every day I read the paper, I read Herald online, and I'm seeing articles about our health care system. I'm seeing articles about health care system in Australia as well, the word crisis, broken on the verge of collapse are often used. What we can observe is this isn't a New Zealand only phenomenon. We're seeing similar dynamics play out across the developed world and in the key markets where we are looking to deploy capital. What we know from being involved in these health care businesses is that health care is a highly complex ecosystem with myriad interconnecting elements. The issues the health care system are facing equally complex, and there's not a simple fix. There's workforce challenges. There's technology challenges, a lack of innovation, layers of bureaucracy and then competing interests everywhere. So what does this mean for private market investors? It's helpful to come back to the macro trends. Put simply, we can observe that people are still getting older. People are still getting sicker. And the proportion of the population who are old and sicker is increasing. Governments are increasing their relative spend on health care. And the number of clinicians simply isn't keeping pace. It isn't on the page here, and this is actually something that Prime Minister, Chris Hipkins covered off last night. But the number of GPs, and this is like your primary interface with the health care system or your initial contact point per 100,000 people, there was 81 GPs in 2001 and it's projected to fall from 74 as at last year to 70 in 2031. So it's really clear we're going to need to do a lot more with a lot less, and the private sector must play a key role in delivery. To be honest, it already is, so within radiology alone, we're seeing a consistent trend of outsourcing of work as public systems struggle to cope with increasing demand for diagnostic tests. And Jason touched on this earlier as well, teleradiology, the read-only component is going to play a key role there as well. It is an all plain sailing. So there's several short-term factors that are causing some disruption. Whilst it's easy to blame COVID and say it's the root of all problems, the evidence is pretty clear that it's had a profound effect on health care systems. It manifests in more ways than simply just impacting top line volume growth, which is actually coming back to more normal levels, and you can see that on the chart. What we're also experiencing is effects like increased cancellation rates often at the last minute. So that creates gaps and activity lists. We're experiencing frontline staff shortages. So in the past, if someone had a sniffle, they would turn up and keep doing their job, [Indiscernible] on with [Indiscernible]. Now they stay home. So it's clear having systems in place that are adaptable and flexible is going to be a critical success factor. The biggest element of a health care services business cost base is people and wage inflation is currently exceeding scan pricing indexation and that's putting some pressure on margins. And then lastly, I want to just touch on briefly, and it's quite specific to New Zealand. We are observing an evolving competitive landscape. Some of the large Australian operators, I-MED, Integral Diagnostics, they've entered the market, they're buying practices, partnering with doctors. And we are seeing competition from practices involving specialists and surgeon ownership. So given these headwinds, we come back to that barrier to entry, I discussed earlier. We are absolutely laser-focused on providing the best possible services to patients on behalf of funders and referrers as well as providing the best value proposition for our doctors and other clinicians. So thank you. I'll leave it there and hand over to Rachel.

And I believe Mike's left me just enough time to explode on stage. As referenced both by Jason and Mike this morning, Health care has been a sector that Infratil has been actively looking at for at least a decade. I was with [Indiscernible] back in 2015 as well and even earlier than that in the health care space. But it wasn't until 2020 that we made our first investment into sort of what I call mainstream health care, obviously, we were in RetireAustralia prior to that. And that was through the investment into Qscan, a diagnostic imaging business. And why diagnostic imaging? Why that is a starting point? And I think one of the things about diagnostic imaging alongside all the infrastructure-like characteristics that Mike talked to is really understanding how integral it is to the health care system. So diagnostic imaging radiology is both part of the -- preventative part of the system through screening programs, but it's integral to so many diagnoses across different disease types, but also across all medical specialties. And we touched on here an example, oncology, where not only is it used in the diagnosis, but imaging is also a point of content throughout a patient's journey -- throughout their cancer journey. So today, we have Qscan. We have Pacific Radiology Group, Auckland Radiology Group and Bay Radiology, the latter 3 that come under the RHC and the et cetera, et cetera, et cetera label. And that group consist of more than 140 clinics and delivering all modalities right through to the very high-end modalities of imaging. It's 275 doctors. So we have deep subspecialization of the expertise across the group to call on. And what for us is really important about our partners or partners with the doctors and also about our radiology businesses is really that local leadership for us. Health care is a local business that needs to be delivered locally. It needs to be owned locally, and it needs to be -- we need our local leaders, our managing radiologists and our regional managers to be identifying growth opportunities within the local regions. And those opportunities can be organic growth in the clinics today like expansion of existing clinics in different ways of delivering services and also some opportunities for a new clinic growth as well. We do continue to look at potential strategic acquisition opportunities and strategic partnerships. But as Jason indicated, very much where they make sense and at the right value point. Teleradiology, I think is already been mentioned multiple times, but it really is a core focus for us. And when we look internationally, we see that as a real key opportunity for the group through kind of our key markets like the U.K. and the U.S. I mean the other thing having -- but having very 2 strong businesses across the Tasman really does for us as well. It gives us a lot of opportunity to explore and identify best practice and use that across the group and also real opportunities to exploit joint investment across the group as well. The other thing the platform does is what Jason was saying as well is it really gives us the opportunity to leverage off that platform. And where are those future opportunities that we'll be able to use are really strong operational expertise to leverage further from. Yes, the operational experience Infratil has in radiology is giving us -- is of increasing interest overseas players. We are having conversations in the U.K. and the U.S., which are markets under strain in health care, but also in markets that are evolving and in the delivery of service as well and our operational expertise here across both the clinical and the radiology read side is of great interest internationally. We've talked about technology. We've talked about the role of technology, particularly in teleradiology. I won't actually go further on that. But really actually what I wanted to highlight was that technology for health care is not just about the ability to read, do remote reads. I think some of the real focus areas for us are workflow management, how we reduce waste of time, how we deliver better quality images and information to our radiologists so they can be highly productive and effective. It's about automation of processes. So we reduced the complexity in the clinical environment. And also as Chris Hipkins last night mentioned, it's about the use of AI and that -- how we use AI to support radiologists in making diagnoses. And these are all areas that we are piloting today and have plans to roll out through the future. So finally, today, we've invested $700 million approximately across the sector, giving us an extremely strong platform from which to leverage from. As we've said several times, teleradiology is one of those particularly attractive opportunities for future expansion. And as I just mentioned on the technology side, it's our investment in IT that we're making today that will enable those opportunities. Yes. Looking forward, we see opportunities both within our existing platform to further our investment through radiology. But also -- and one of the reasons that I referenced that like integration of AI into the broader health care environment is that platform that we have in DI also offers opportunities through our other medical specialties as well. Oncology, pathology, these are areas that we have been actively tracking and looking at for some time now, and hopefully, we'll provide opportunity in the future. That's it for me, and I'll hand over to Chris Munday, who will talk you through more detail on Qscan. Thank you.

Thank you very much Rachel and Michael. Thank you, everyone. It's great to be here in person rather than on teams, which I've done for the last few years. This is much nice and great to be in Auckland. I'm going to tell a little story as a segue into my presentation. My morning started this morning with an e-mail. It was about 6:00 this morning, and it caught my eye as I read it, and it was about an investment opportunity that Qscan has in Brisbane and it involves some acquisitions of some equipment. And one of the pieces of equipment is a CT scanner, okay? It's a big white donut-shaped machine that you lie in and it takes pictures of your -- well any part of your body, but I was particularly interested in the fact that this machine is cardiac capable, okay? So cardiac capable CT. Means it can take really high-resolution photos of your heart. Now why is that something of interest to me? Lots of reasons so I'm in the age demographic of a 50-plus-year-old male, who is at risk of heart disease, the leading cause of death in mean over the age of 50, but heart disease is not sexist, so females equally likely. So that's something I'm very conscious of. In addition, as some of the Board know, and I'll only touch on this briefly, but I lost a great mate 3 weeks ago to a fatal heart attack at age 55, just dropped dead just like that. So this is the guy's best man in my wedding and a very good friend. So had he had a cardiac CT, he would not be dead. simple fact, okay? Just put the card on the table. diagnostic imaging saves lives, full stop. It just does, all right? If you have a photo of your heart done and it shows you've got a heart disease, they can do something about it. Now the second thing that happened this morning was as I was literally finishing that e-mail is that Mrs. Munday sent me a text. Now there's 3:30 in the morning in Brisbane. So in order to say, [Indiscernible], I should respond to that text. And the text said the pump is playing up. Angry face emoji. Now I knew what that meant. I was going to [Indiscernible]. That meant that the pump that some [Indiscernible] a plumber decided years ago to put under the main bedroom of the Queensland at the house I live in was playing up. So there was a blockage in the pipes and a pump was cycling through trying to push water through to our plumbing system because rainwater. So I had a moment of brilliant wit for the morning, and I decided I would turn back to text that said, maybe you should organize a cardiac CT. Now I knew this was poking the bear, but that's what keeps marriages alive and happy. So the response came back, well, actually, when you see text coming back and it takes a long time, and you're kind of wondering what draft they're up to. It was like that. And eventually came back very funny. But the point of that very brief story introduction is that diagnostic imaging does save lives, and It doesn't cost a lot to save your life. So the plumber will come out. And he will tell me what I just told you because I diagnosed the problem already even though I'm not a plumber. And then he's going to charge you several hundred dollars to come out there and several hundred dollars to fix it, and I'll have a working pump. But the single most important pump in this room and every one of you have got one is there, that pump. And far less than the price of what that pump is going to charge me, you can go and get a scan and find out that your pump is perfectly healthy. So there's the message for the day. Go get your pump checked, okay? All right. Qscan. Now you're all thinking about diagnostic imaging. That's us. It's been an exciting journey, well, last as I read that this morning, I thought, yes, there you go, I had my first cardiac CT at 2018 and then the next one at 2022. So M&A is another reason why I said, yeah, heart checked. Here you go, Paul, I have to think about that one. It's been a great journey. We've built a big company now, and it's fantastic to have Morrison and Infratil involved. We are the market leaders in PET/CT. We have invested significantly in those high-end modalities, okay? So MRI, CT, PET/CT are where the growth opportunities are, because technology is so good that we can do things like take those great photos of your heart or have these incredible images of your body and detect where the cancer is. So that's the future of radiology. 150 doctors. I like most of them because there's probably no one here in the room, but I do like all of them. Radiologists can be a bit difficult. But no, generally, they're a good bunch, and we have over 1,000 staff, and we've grown nationally now with a great footprint. And I'm very proud of that regional footprint that we have at Qscan. So we're investing significantly in regional Australia, not just the metropolitan areas. Our vision is be #1. #1 doesn't mean I necessarily want us to be the largest radiology group, that's not my personal goal, but absolutely want us to be the best at everything we do and #1 in each market in terms of the quality and to be the leading diagnostic imaging company. If we are able to do that, then we're making a big difference in people's lives. I want to be the employer of choice, not just for radiologists. I want to be an employer of choice for clinical staff, clerical staff, for everybody. And innovation in medical research are really important to me and Qscan. Innovation through technology. To be frank, we are a technology company, okay? Everything we do is about technology and using the best technology to save your life. And medical research, which is something we haven't done as much in the last -- certainly until the 4, 5 years ago. We've invested significantly in that space recently. It's a great opportunity for the brand. It's a great opportunity to encourage doctors to join us. So research and clinical trials, I think we're doing 120 clinical trials right now. Terry, you might talk a bit about more of that. They're actually in New Zealand, well ahead of us. They've been doing it longer. And 1 of the great opportunities for the 2 organizations is we have to leverage off each other's experience and which we're leveraging off our each other's experience in that space. That's a snapshot of the industry drivers. They remain there. Yes, we've had a couple of challenging years out of COVID, and I'll talk about that in a second. Simple fact is the population is growing. The median age of the population is growing. And I mirror the first bullet point, the general health of individuals tend to deteriorate with age. Regrettably, at age 53, I've discovered that and suddenly the dodgy me, and the dodgy this, and the dodgy that seem to be happening. So none of that is going away. The key industry drivers are there in diagnostic imaging. Federal funding remains, this year, I'm hoping we'll get a little bit more on the indexation than we have previously because of inflation. So we've budgeted a bit higher than previous years. Visits to a general practitioner, we anticipate to increase. We've had a difficult couple of years in this space, and it's been a little bit hard to work out why referrals had dropped off. And I think there's a number of cumulative reasons why we've had the challenges of FY '21 and '22. FY '21, in particular, of course, GPs were somewhat busy vaccinating Australians and New Zealanders. That was 1 reason. In addition, we've seen quite an uplift in telehealth. And telehealth, I think, has resulted in a little bit of a drop in diagnostic imaging referrals immediately because if the person doesn't walk into the GP's office and look at the GP, the GP may not immediately think, like, let's have a quick look at that new or let's have a quick discussion. In addition, mental health has been a growing challenge in society and more and more GPs are having consultations with telehealth, and they tend to, therefore, be longer consultations. And I think that's also slowed down some of our referrals. But we are seeing a change in that and even in the first 3 months of this year, in particular, we're seeing quite an uplift. Finally, and I noticed personally, when I walk past the GP practice downstairs in Brisbane, GP practice haven't exactly been a welcoming place for the last couple of years. You have the safety saying out in the front and then there's signs everywhere saying, wear mask and everything else. So there'll be a younger demographic in this room, who wouldn't think too twice about that. But the 70, 80, 90 year olds think long and hard about whether they're going to go and visit the GP when it looks a bit like it's some sort of concentration camp. So I noticed the other day when I was walking down as I passed RGP, it's of the GP practice near our work, that it's significantly more palatial place to visit, suddenly all those safety saying have gone masks out are around. So we're seeing people going back to the GP. Graphs, I don't normally like to show the graphs. They have a downward trend unless it's my cholesterol level. So in this instance, I guess it's an important one to show you what's been happening in the industry. I'm delighted to say that we've been outperforming the industry. So the purple line outperforms the gray, but you can see that the middle phase there, very much were GP. GPs, of course, 1 of the biggest referrers, for us GPs, and they refer to specialists and they are the other people refer to us. So that downward trend in '21 and into '22 has certainly impacted diagnostic imaging. That's starting to flatten out. I think for some of the reasons I've just said. People are going back to the GP. So we're starting to see that and you can see that uplift is happening for us and the industry at the end there. And I can tell you that the March month-to-date figures for us are the best we've had in a very, very long time. In fact, I noticed in WA, we're well above budget in the WA practice for the month of March. I think I probably covered them. COVID, we talked about. Floods, yes, well, it's no fun in Mother Nature, also takes a shot at you. So this time last year, of course, Northern New South Wales was heavily impacted by the floods and we also had 1 of our major clinics, in the Windsor clinic in Brisbane, which is the original first ever Qscan clinic and we had 1.5 meters of water go through that clinic. So that doesn't help your EBITDA line when you lose a clinic. So we've got a few challenges. Fortunately, that clinic has just reopened and is performing back above what it performed at prior to the flood. So that's a great. And critically, surrounding clinics that would have -- that referrers would have referred to and therefore, cannibalized, we were worried that we'd lose there. But in fact, we're retaining most of those referrals. So we are getting good growth in that region in Brisbane. Trade has restricted and delayed some of our greenfield sites. But again, we have scope to continue to grow those in the future. So a good year-on-year improvement, particularly in March. Current financial, the financial highlights. Look, we'll look to do around just under $300 million as a revenue line for this year. And the EBITDA will be sort of normalized in this around $50 million. I want to talk about EBITDA margin. It's been a real challenge. We have got a reasonable fixed cost base. If a sonographer is doing 12 scans a day -- the ultrasound scans a day, because we've had that volume dropped. The fact is to do 18 scans, I don't need to spend any more money. It's the same wage. So as volume comes back, we get lift in margin. The other 1 that lifts margin materially is the doctors. We deliberately invested in young doctors over the last 4, 5 years. One, because we need to have the future cohort of some specialists, radiologists and in addition, we had a pretty aggressive greenfield site growth. The challenge with that is that radiologists have a life cycle, if I can call that. So junior radiologists are less productive and efficient as senior radiologists. So we have a greater cohort of those. But as they mature, as they become more experienced, they become more productive and we can benefit from that. So that's 1 of the reasons why we are a bit more bullish about that margin getting back up to where it should be over 20%. The next phase, that's strategic pillars. I'm not going to pull all of them in there, but just a couple that I'll call out. Our vision and our values are very much linked to those strategic imperatives. I wanted to the call out the managing radiologist leadership structure. We've really got a mentality of locally led essentially supported that I'm passionate about in terms of success of how you run a radiologist business. You can't run it all from a support office or a head office. And that's what it should be. I support office. It should support the regions, which means you've got to have really good regional managers and then regional managing radiologists and local leadership. That's the structure that we're building in Qscan. I think it's similar to what technique RHC have got. It does require an investment in leadership. We've got fantastic radiologists that doesn't necessarily means they are brilliant at all aspects of leadership. So we are continuing to invest in that area as we are with our regional managers. The Teleradiology strategy, I mean, it's super exciting. We talked about already a little bit. The big investment in IT this year is all about bringing those businesses that you saw on Slide 1, all those different acquisitions and integrating those as seamlessly as possible and with disparate systems across them as we've acquired businesses, the technology that we're putting in place now, the big investment is to ensure that the Teleradiology across those businesses is seamless. So that if Paul is sitting in Perth and wants to access a scan in Sydney or quite frankly, in Auckland in due course, he is able to seamlessly, and we are able to effectively sort of support office operate as what I would call a flight traffic controller. I can push the work no matter where it's done to the right radiologist, because Paul might be a musculoskeletal expert, and maybe Mike is a cardiac expert, I can then push those scans from anywhere in Australia to the right doctor in the right place. In addition, if Paul is doing a fellowship in something, I can grab scans that suit his fellowship and send them to him. It's a really exciting development. It's a significant investment, but it is transformational. That is our intelligent radiologist workflow orchestrator. That's called Clario. In addition, for your interest, if you think about the radiologist work list, which is a bit like an e-mail list, most of us in this room feel like the e-mail list never ends. That's what a radiologist work list looks like. So enables me to create an end. I could just give Paul 60 scans for the day, so he can see, he's going to get to the end. In addition, the technology that we're getting into these systems is clever and is able to see that a scan was just done of a motor vehicle accident, it's an MRI brain, that's something I want Paul to report on right now, it will bring that to the top automatically. It takes away the wrist x-ray that push Chris' wrist x-ray and pushes that to the bottom. That's not going to kill Chris. This MRI brain is really important. Automatically sends it to the top. A New Doctor Rem Model. This really is led off the back of the IT, okay? So as you brought these different businesses together and those incredible systems I've just talked about, I've got to have a contracting a rem model that works for the radiologist, so that Paul who previously didn't report from Perth anything done in Sydney, and now he can. He needs to know he is being remunerated for that and that I've got a contract that facilitates that. So there's a really exciting Doctor Rem and contract model that we're working on at the moment. We're really just building on the success we've had with some of the fixed and variable rem models that we've been using around the group. A lot of lessons in 5 years since the original quadrant investment in this space. So it's really just taking it to the next phase and particularly highlighting or improving the productivity and the efficiency that we get from some of those incredible IT systems that we're implementing. So where to in terms of future pillars of growth, Brownfield expansion is something I'm pretty keen on. I've got a lot of space in clinics. We often have clinics that are adjacent to shopping centers or have opportunity to space that comes up. And I already have doctors on the site, I already have staff on the site. So actually adding a bit more space or using existing space and adding a modality is a better way for me to operate the business. And if I add more greenfield sites, I've got to go and find the staff and quickly, I've got to find the doctors. So Brownfield is actually something we're a little bit more focused on. We will continue to do Greenfield, but it is strategically and again, making sure we've got the doctors to be able to service there. The IT transformation, I think I've talked about, and M&A, absolutely, we'll continue to look at opportunities that are accretive, but restricting that to top quality groups. We've walked away from some opportunities that others haven't, although I noticed that Infratil eventually walked away from something that I didn't want to pursue. We want subspecialty experts. We want quality, I want businesses to support my Q1 agenda. And lastly, the left-hand slide is not fun and the right-hand side is fun. The left-hand side is 1.5 meters of water going through your clinic this time last year, February 28, and then the right-hand side is the rebuild just reopened. That is the most sophisticated MRI machine in the Southern Hemisphere on the right-hand side. So Windsor is now a center of excellence. That's something else I'm passionate about is building centers of excellence in each capital city in Australia. I've already got 1 in Perth by the acquisition of the Best Radiology Group in WA, which is Envision, and this is very much a center of excellence in Brisbane. So that's very exciting. That's the MRI machine with the Philips Ambiance package there. So that the patients get to see anything from finding NEMO to anything else that might calm them as they have their scan. And lastly, a couple more products to finish off, some of the MRI scans. Middle 1 at the bottom, the staff wisely climbing the $2.5 million machine at 3:30 in the morning when the CEO is fast asleep and doesn't know about it because otherwise that part would terrify me. I suspect as I watch that being load in. But we're investing significantly in these high-end modalities, that's where the growth opportunities. That's great for margin as well. And it's exciting. That's it for me. Thank everyone.

We might do a couple of questions maybe before we ask Terry to join us because they might think specific to your business and at the year, there might be something around sort of the Australasian environment. So there are a couple of quick questions now. We'll get Chris to take them.

Wondering if you could just give us a bit more information around the kind of changes to the Doctor Rem Model, and kind of -- and the reasons why you're looking at changing there?

Yes, good question. Look, the main reason why we're doing it is because of that technology that enables us to have a doctor literally anywhere report a scan. And I want that done, okay. I want the subspecialists cardio expert in Brisbane, being able to report the cardiac scan that is done is Perth. And through the acquisition phase, we haven't got the identical rem models or systems in place in each location. So by having ultimately a single rem model, it will be -- provide far greater clarity for the doctors and encourage them to report across the different regions. At the moment, we do that, but it's a bit clunky. So it's about fixing that clunkiness that we've got in the system because that is the future of how we're going to operate the business. In addition, we've got and at least a couple of the areas -- all of our areas have fixed and variable rem models. That's great. We'll maintain that. That's really important to us. It works well. It means that we have a reduction in volume, like a pandemic. The doctor cost comes down with it. So that's been a great advantage of Qscan that we've had over some of our competitors. So we're retaining that. But there are within those different regions, different ways they operate the variable component. And 1 of the ones in Brisbane, which has been more successful as an RVU model, which drives productivity. So we're looking at introducing that into some of the other regions. So working hand-in-hand with the radiologists on that. It's making great progress and it's an exciting transformation.

Just a follow-on. Are you seeing in terms of budget [indiscernible] is that more profitable growth to do that?

No, I'm kicking off the young ones, because they need to refer wise and they don't have that. Now young radiologists. We're seeing young radiologists coming to the larger corporates looking for the subspecialty expertise mentoring. Again, the systems I'm talking about, the significant investment in IT is designed to further facilitate that. So quite literally, I can have a doctor in Perth, who wants access to a fellowship, and they can do that now with accessing subspecialty experts in all the other capital cities, rather being isolated in 1 spot, but they won't get access to enough scans to be able to fast track their career. So no, we're not seeing that in Australia. It's the opposite. I'd say we're seeing more approaches to the larger groups who can provide that training and that mentorship. And I can't understate the mentorship. That's really, really important in radiology. So we will continue to make sure we keep our radiologists working longer, even if they reduce days at the latter stage of their career. For me, it's about keeping those people staying on longer to help coach junior radiologists.

Could you just comment on what -- any major differences under ownership under Infratil, Morrison & Co versus Quadrant in the past?

Where's the Chairman? Well, it's an easy 1 to ask, because I really enjoy working with him. I mean, Michael and Rachel, I've had a lot to do with. So what are the differences? Well, I guess the answer to that is the Quadrant where I -- from day 1, very clear that they're in -- they want to be involved for 3 to 4-year -- I said 3 to 5-year window, which I thought to be 3 years and 1 day. So -- and that was crystal clear the way they operated their whole life. One of the things I like day 1 about Infratil when we heard it today, was Infratil invests in ideas that matter. And I was really interested. I haven't heard Michael -- I hadn't spoken to Michael before today about what he's going to speak about, but he made the call out that health matters, and I've said that in my talk that health is the most important thing in this room. So that would never have come out of the mouths of the Quadrant, okay? Never. So to hear that, that they are long-term investors, they believe in health. That is something that's super exciting for CEO and that's continued through the process.

Thank you. I'll invite Terry on to the stage. I'll say you talk about the New Zealand business because a bit here, the hard time you've been given about the economy, but there's a good reason why there's several brands in there, Terry, but welcome to the stage.

Thank you. Good morning, everyone. Terry McLaughlin, Chief Executive of RHCNZ Medical Imaging Group. Who the hell is RHCNZ Medical Imaging Group, I hear you ask. Really, it's the 3 market facing brands that a lot of you will be familiar with if you live in New Zealand, Auckland Radiology Group, Bay Radiology Group and Pacific Radiology Group. So Pacific was the first came off the rank to join the Infratil stable about 21 months ago, and I was CEO at Pacific at the time. And 1 of our key drivers in seeking a new majority owner was our ability to become a full-scale national practice. And so as Jason indicated, and Chris did Qscan, RHCNZ Group went on to acquire Auckland Radiology group and Bay Radiology group. So you can see on the map there a fantastic national footprint looking a little bit closer in terms of population demographics. There are probably 3 parts of the country where we don't have coverage. One would be Norwalk and Whangarei and otherwise on the East and West Coast of the North Island. And I'll cover off later the plans that we have to plug growth slots. So I think we took a pretty strategic view of what was going to happen with the health reforms in this country and wanted to position ourselves to be a national provider to work alongside to Pandoro, and I think you can all see how that's playing out now. So national portfolio, 70-plus clinics, regionally even spread North and South Island, importantly located with virtually all the private hospitals in the country. So Infratil brand association with Southern Cross Health care evolution by way of the Wakefield Clinic and Wellington, St. George's Hospital in Christchurch and Mercy Sisters in Dunedin. So a long association with those private hospitals. 144 radiologists nationwide. That's 1 in 3 radiologists in New Zealand in both public and private sectors and the scale of representing to us with enormous opportunity to continue to grow and succeed some 1,300 staff nationwide. We do have a 24/7 teleradiology service. We've had that for a number of years. So that's the outsourced reading of images from [indiscernible] We had London office for quite some time. It got difficult to sustain and maintain during COVID. We moved to a contractor model and complementary time zones in South Africa, U.S. and Europe, but we're moving back to open up our London office again. We've got someone up there. Now and that gives a specialist working at 12 o'clock at night and Timaru, we believe pick up the phone and have a familiar voice. And it's a real point of difference, we believe, in terms of our teleradiology offering we will continue to grow. Financial performance, look, Jason spoke about the headwinds. COVID has been a really confusing one for us in terms of the impact on volumes. Volumes normally grow. We enjoy volumes growth around 7% year-on-year. That's kind of global [indiscernible] imaging, we enjoy that and our RHCNZ Group in New Zealand is flatlined a bit in the last 18 months, because our health system has been gridlocked. If you think about yourself, your families, your friends, who have tried to get to see their GP, as you know, the first point of contact is challenging. It's difficult, Prime Minister last night excelled the virtuals of -- virtual consultation. But that hasn't -- you would think that a virtual consultation might lend yourself to see Qscan, has actually been the opposite seemingly. But we are seeing signs of the system recovering. Our general practitioners were hammered during COVID. They bought a brunt of it. They were tired and exhausted, but that seems to be getting better. So there are a range of -- there's a range of evidence that's corroborating a recovery back to the long-term growth trends. We can go back 15 years and see what the growth is. We're confident that, that will return. And so our assumptions are that will be the case. So volumes is reflected in the revenue side of it. The confluence of those headrooms comes into a bit of a cyclone actually. But I think what the fact that we're able to maintain and in fact, continue to grow our revenues and our EBITDA, reasonably maintained margin is a reflection of the underlying strength of the business. Like Qscan, we have a commitment to operating in all parts of the country. So we're not just cherry pickers or operator and some high-tech start in metropolitan New Zealand where you've had a long-term commitment to being an integral part of the health system in New Zealand. I'll give you 3 examples of that. So this week, I was down in Timaru looking at our new branch, which is colocated with Bidwill Private Hospital. So probably 2 years ago, we had a joint venture with the local hospital. They wanted to get MRI in place and have 1 down in South Canterbury. We worked celebrative with them. We've got both got to the stage where our private volumes via public volumes mean another MRI machine was possible in the town. That's a fantastic facility. It's a beautiful tailor-made building. Our staff love working there. Patients love coming there. And I guess, as an example, again, if you think about what the Prime Minister was talking about last night, the frustration of getting things done. We got to get things done. We can have these clinics up and running from where to go and probably a couple of years. Another example would be in Christchurch, bunch of sports physicians getting together in our practice, we identified the need and the opportunity to work with them. So we've co-located downstairs from the sports physician or totally arms-length arrangement. They -- we enjoy their presence, they enjoy being able to send patients down and just having an x-ray and ultrasound, come straight away. We continue to plug the gaps at Christchurch and modality types and Palmerston North we opened a branch 10 years ago. It didn't have a CT. That's gone in. So that would be kind of an illustration of how we continue to grow and expand. Our future plan capability in all these projects and playing out and I think this is a really important example of the stuff that we are doing and helping the New Zealand population. So if you take Whangarei, by the middle of this year, there will be a new branch operating there. We know there's demand for an alternative provider. We know there's demand for PET/CT. If you have a cancer patient in Northland and Northland has a higher proportion of nordic, a high instance of cancer amongst that community, 600 patients have to travel very long distance from Whangarei to Auckland to get CT scan, that will be done now in Whangarei. We're working closely with the local community to introduce that facility. We keep a close eye on population demographics. North Hamilton is an example of that. Those of you who are familiar with New Zealand environment, a very fast-growing part of New Zealand, an opportunity to put a full-service branch. And we'd like to at least match population growth and sometimes it gets slightly ahead of the curve. Whangarei, again we worked very closely with the local DHB there and helping that radiology and that mandate radiology department. They've got to a point where they need a second MRI. Actually, they were delighted that we said they said we're opening up a clinic here because that saves them having to do it, that saves them having to go through the hassle of getting approvals even under our new system. It does takes a long time. The branch will be up and running in a year's time. Dunedin Central was going to be a flagship branch. And I guess for those of you who again in New Zealand seeing the news, all of the abate happening around, what's going to be the size and scale of the hospital, are they going to have 3 MRIs, are they going to have PET/CT, I suspect for the time we've had this clinic built in 2 years that debate will still be going on. But the population of Dunedin, the Otago Southland will enjoy having PET/CT provided locally. So again, an example, those patients have to travel to Christchurch from a Otago, Dunedin. These investments have a major impact on people's lives and people's health. Tauranga is going to be another flagship branch. So PET/CT, picking up as a bit of theme for us there is a major difference in terms of cancer outcomes for people in New Zealand compared to Australia. The funding regime in Australia is a lot more generous. The range of cancer tumor types funded in Australia is far more significant than New Zealand. Nonetheless, we believe that getting ahead of the curve in this modality is a good investment for us to make because we know that whatever government will be under, an ordinate pressure to kind of level up those health outcomes between Australia and New Zealand. So we think this is going to be a really good thing. Auckland is going to have a new flagship branch. Napier, as I mentioned earlier, okay, it's a gap in our geographic footprint. We'll have that branch up and running at the end of this year or early in the New Year. That just leaves Tauranga and there'll be a range of options for us via a complete full national footprint that is really we believe the jewel on the crown. We do this off the back of long-run industry drivers. And so, I won't spend a lot of time going through the slide because I think Mike and Rachel have covered well, the New Zealand like, Australia like, the rest of the world, same trends, ageing population, increasing incidence of chronic illness, increasing demand and social demand for diagnostic imaging is the best way of architecture and prevention of disease. I've mentioned the oncology piece. And the post-COVID context is an interesting one, right? So I think the confluence of that and the creation of Te Whatu Ora creates a really significant opportunity for us and I'll talk about that in a later slide. Our competitive advantage I've alluded to scale enables us to invest, enables us to attract and retain the radiologic expertise. Our breadth and depth of subspecialities is totally unmatched by anyone in New Zealand and talent attracts talent. So we've got a very strong focus on getting doctors right from mid-school to come into radiology to come in to the RHCNZ Group and really now like-for-like focus on securing that pipeline. We know we've got the best people in the industry. Investment in technology fundamentally key, as Chris said, we are a technology company in the whole sector really. We have a strong investment in research. And our stakeholder relationships are actually precious to us. Our strategic colors be the key part of the health system in New Zealand, first choice for patients and refers a great place to work and grow and be a leader in innovation and technology. So a key partner health system. We had a meeting recently with the 4 new regional directors of Te Whatu Ora, like a very mature sensible conversation, game changing from what we would have heard 20 times over with the district health boards. They are seeking a true partnership. I say, what does that mean? They want assurances around access for patients. They want assurance around, more guarantees around on longer-term pricing arrangements. It's been tested for us. We don't have to maintain 20 contracts, 1 contract same quality of service, a longer-term contract, giving us a bit more assurance to invest wisely. Other things that are seeking a partnership and recruiting and retaining staff. We're good at doing that. Actually, our staff turnover is very low. We don't have critical staff shortages. We are good at what we do, and we believe we can share some of that with the system. We're very good at technology. We believe we can share some of that with the system. If Te Whatu Ora want to recruit a radiologist and say how to recruit here in New Zealand, provincial median somewhere, we can partner with them because they can have an opportunity to work in private practice. So these are the things they're looking for. We're presenting our capability statement to Te Whatu Ora in the next couple of weeks. And I think that dialogue will continue in a very healthy way. The relationship with Te Whatu Ora, I think, also will influence the wider health sector. They're very keen for ACC to be a bit more part of that picture, rather than perhaps out on the side here. So whilst we are all, perhaps skeptical about these health reforms, I think you can see some glimmers of hope in terms of how it's going to manifest itself. So in summary, and people spoke about those common characteristics, great diversified funding streams. We've got excellent market share, 4x as large as the next provider. We are the employer of choice, and we've got fantastic future growth opportunities. And I can see right down to zero. So Mark, happy to take questions.

As I start to, can you tell me perhaps what do you think are the largest competitor threats are, whether that comes from public or private sector? And how you're positioned against those kind of competitive threats?

Yes. So it's interesting in New Zealand a couple of years ago all of the private practices were largely and doctor ownership and from for Pacific Radiology was the first large cap of the rank and that's precipitated everyone else selling. I guess slightly retail, sort of my mind as well as New Zealand actually ready for that. It's created a lot of interest. And how is it that a bunch of these people working in a dark room can create and create such major terminal value. And so that's -- a lot of people are thinking, well, maybe I can get into this as well. So for those of New Zealand, you would have seen a lot of data last year around the ethical issues of the referrals going into this game. We had strong views on that. To be really clear, we are fully supportive of competition. Competition is a great thing. We had some ethical issues that others aren't expecting. So that referral owned magnet piece is occupying our minds. We're not sitting still on that. As Mike said, the key bar to entry is really get the radiologist. So yes, you can go and lease the building. You can go to Siemens and [indiscernible] the thing. But how do you get the radiologist read images, how do you get the technical staff to run the machines, how do you get the quality systems in place, how do you get the technology to drive all that, and this is a question for Chris here, right? Why don't young guys go out and see it and set up practices on their own, because it's actually very hard and you need scale to invest in all of these areas. Nonetheless, a real threat, we're looking at what we do in those kind of commercial relationships, we believe is plenty of opportunity. We would much rather partner with people who want to grow the pie rather than having a slice of that pie. And we think that there's good opportunities to do that. There are whole range of other specialists who want to work collaboratively with us. So I'm not at all complacent about your question. It's a very good one. Technology would be the obvious 1 that see artificial intelligence. We see as being our friend by far. So we are rolling out a really good AI product this year. X-ray the most common form of diagnostic imaging. And if it's successful, it will deliver the results that has been delivered elsewhere, which is a material uplift in quality and material increase in speed. Presenting here we had radiologists conference here in Auckland a couple of weeks ago, and we were talking about this, and 1 of the guy said, "Well, look, 1 of the intangible benefits of this will be a reduction in my anxiety as a doctor that I'm going to get it wrong." And so if you take that away, we believe the benefits will be significant. We're going to take a really robust disciplined approach to investments in AI. There's enormous range of products out there. A lot of them not commercially viable, but we're at the bottom of that J-curve, we believe. So we've got to get our doctors comfortable with using it, used to it. Globally, we will have to embrace AI, something goes around enough, doctors to go around, and that will be in kind of the lower tick areas. And I've seen another professions who have come from [indiscernible] and you think, well, how are these big disruptive threats actually your business changes and adopt then, you move up the complexity curve in terms of the offerings you have and have AI to deliver a little of the commodity stuff. So that's how we're seeing that as well.

Great. Last question for me. Going back to the rem model. Here in New Zealand sort of do you have the same fixed and variable kind of idea? Can you give us some kind of metric?

Yes. So I spent the last 1.5 weeks going around the country and talking to 140 radiologists. We've been working for the last year on a new rem model. And we are moving to introduce a performance-based pay system on top of the rem. And like Chris said, that is a key supporter of the technology that's being rolled out. But it's a wonderful opportunity to reward people who have performed better. And if you look at the distribution curve and our doctor group, it's wide, right? But some very fast, high performers and next group that are well above the average line, a large group slightly below the average line and some ones that are slow. So our objective is to raise the average line a little bit and that will have a tremendous impact on the business. Our modeling would indicate probably at least 10% or 15% gain -- productivity gains. So everyone gains here, the doctors get paid more. The costs are less, because we need doctor, less doctor resource, as we grow. If you're having -- going back to long-term growth trends of 7% volume growth year-on-year, you have become more efficient. So how is that being received? Look, I think, I believe it when I see it, right? A high degree of sketches and these are exceptionally smart people. I can see a range and we're thinking how do I gain that system. We've got a whole range of safeguards in there. But look, I think it will go well. I think I'll let you go really well.

Yes, sorry, just quickly, given the backdrop of doctors who are just, as you mentioned you have 1 in 3 radiologists in New Zealand in the group. So the kind of shortage of radiologists is that more being felt in the public sector as they can't pay as much as the private sector or is it kind of being felt across the board, with you as well?

Yes. So the supply of radiologists in New Zealand is not too bad, but your question is right, if you get some. So in terms of what's in the pipeline, it's probably enough against the growth. It's how they're deployed. And then our doctors are incredibly productive, because we've got supportive systems. We measure what they do and they get rewarded for that. And that's not necessarily the same in other systems, right? So maybe that's a factor on why supply is not quite enough.

And is fair to partner -- partnership going to hopefully relieve some of the pressures of the system more generally in terms of shortages of radiologists?

Yes, is the answer. So already most of our doctors work in both public and private. That's why we are an integral part of the system. I think that we just get things done faster, right? So if you come to us, you get a scan less than a week. Obviously, we just kind of know over night, everything kind of getting public. But stepping back, the key thing I've got to make sure in this partnership discussion is they want to take a sensible approach to capacity in both public and private. And that was so reassuring to me that finally, we're getting some sensible conversations are happening around how you can use, work with private. So, I think, there's a lot of opportunity.

Okay. Thank you very much, Terry. I know that feels a bit rushed. It's the nature of our -- having multiple investments within the portfolio. So thank you for your time. We're going to take a very quick, it's going to be a 15-minute break just for toilet and stuff and then we're going to go back to listen to the renewables section, which is pretty exciting. So thank you again, and we'll see you soon.

Okay. Now we go global, which is very exciting. You've obviously heard the intro about where we feel we are positioned within the renewable sector and the opportunities we've got. So you've got a number of people who are about to talk to us, who will give you, I think, a lot of confidences here. The first person is, I can see him down, he's going to come up behind me is, Vimal Vallabh, who's the Global Head of Energy from Morrison & Co. and Vimal was responsible for the introduction to the Longroad team 6 years ago, 7 years ago, and then based himself from the U.S. for some time. And as that business has matured, he's moved on to help establish the Galileo business in U.K. and Europe as well as obviously coordinating what we're doing in a global sense, et cetera. So I'm going to get Vimal to open, and then we're going to have Deion, and many of you know from the Tilt days, and we're thrilled to have him and Clayton back in-house now, and he will get to talk a little bit about the markets here in New Zealand and Australia and Mint Renewables, which is obviously the newest vehicle to the family of renewables. So with that, Vimal welcome.

All right. Thanks, Mark. And hi, everyone. Sorry, I can't be there in person for the Infratil Investor Day, but I'm pleased to be here virtually with you and to talk to you about some of the activities that we're doing in the renewable space around the world is how the Infratil global renewables business is. Maybe just if we continue to Slide 1, and I can walk you through some of the highlights that we're seeing around the world. It's certainly been an active year. We're seeing increasing commitments from governments and increasing calls from society to do something about climate change. I was in Berlin this week, meeting in the Infrastructure Investors Forum. There is a lot of chatter about more investments and increased enthusiasm about putting more renewables in the ground. And that translates to government commitments and is driven by government commitments in some respects, not just the countries that we normally hear from, but other countries and other continents, all increasing their targets to transition through to renewable energies. And that is driving a lot of levers driven by a lot of different things. Energy is sure to being 1 of them, and that's being re-highlighted by the invasion of the Ukraine, but also an opportunity by a number of nations to redefine their re-industrial and reindustrialize their economies. So a lot of that is driving a re-shoring of manufacturing facilities. That will give greater security across Europe and across North America and Asia. So that's quite exciting in the space. We are seeing unprecedented levels of investments going into the sector, primarily in wind and solar, but there are emerging technologies, a lot of money going into tech and trying to solve some of the issues that renewables creates on the systems. That's being driven by a lot of governments. Governments are recognizing the challenges that the industry creates, but also trying to solve them simultaneously. We at Infratil really quite well positioned to take advantage of these opportunities. There are -- the government says they come in with new policies and new ideas. They come in at different speeds. And what we cannot do as much as we look into our crystal balls is figure out exactly when they go down. And so what we've done in Infratil is build a series of options globally and allow us to take advantage of those markets when they become mature to make investments and grow our business. And it's that partly by partnering, bringing our own expertise into these portfolios, but also partnering with our local teams. So Paul and Michael and Charles, you'll hear from later on, we've backed 1 of the best teams in the market in North America, delivering gigawatts of power. We've got Galileo here in Europe doing the same thing. So we've been growing in Asia, and you'll hear from Deion about Mint and how we have established that to address the Australian markets on a given our exit from Tilt. Those platforms together, we've got 3 gigawatts of operating or under construction. We've got 30 gigawatts of optionality in the pipelines within those businesses. Not all will be built, but they give us options in those markets. And when those markets become mature and allow us to deploy that capital, it allows us to take advantage and optimize the returns that we had with the capital that we have to both work in that space. We got flip to this next slide. So you would have seen the versions of the slides, various markets, various places. We present the vision of this story before. I guess the key message on Slide 4 is that then the growth in the market continues to expand. Every year, we're seeing more commitments from governments and those are just adding to the transition that we're seeing. Wind and Solar remain the key technologies. They now maintain quite a significant cost advantage on other technologies, sorry, Slide 4 again just go back one. Yes. Wind and solar maintain cost advantages. And I think those cost advantages are going to increase over time. Although we have seen with inflation, the increase in cost of deployment and technology, we're also simultaneously seeing a reduction in the capital going into new gas -- new gas suppliers, particularly in Europe and rest on the U.S. That's going to then create -- not going to fit into the supply and the cost of fuel sources for gas, technology and increase -- ultimately increasing cost there for gas come on to the system. Then again, gives renewables and the cost advantage in the market and increase the demand for new capacity to come out of the system. Maybe if I flip to the next slide. So if we look at the 4 major markets or 4 major regions that we're in, I haven't included nature on that one, but we're still in development there. But the U.S. and Europe have all come out with various support policies. In Europe that $400 billion to extending our renewables here in the market, including the development of renewable technologies hydrogen, which I'll talk about in a moment. In the U.S., 1 of the major developments over the last 12 months and seen the introduction of the IRA to accelerate new technologies and support the expansion of wind and solar, hydrogen, nuclear and as I talked about industrialization, reindustrialization of the economies, including onshoring of manufacturing facilities. Now if we flip to the next slide. So what we're also seeing is, as I mentioned earlier, some of the problems that renewables does create as they enter the systems and governments are looking to address those. One of the emerging -- 1 of the most talked about technologies is hydrogen, still an attempt, still looking to sort -- overcoming some technical challenges, but likely to be vast in its application. That's also then going to create demand for more renewables. So we're quite excited about that as emerging technology, not too dissimilar to where we saw wind and solar in the early days, but probably under a more accelerated time frame given the problems that it needs to solve and the amount of money and technology going into the space. Turning to Slide 7, if I can. Some of the highlights that we've seen across the portfolio. Longroad raised $500 million, and we value that business at $2 billion as a result of that transaction. Further strength of its procurement strategy with local suppliers, and we have about 2 gigawatts of construction and for staying until the next couple of years. You'll hear more from Paul later on, on what's in more detail. In Galileo, we continue to expand our presence in various markets. We're across 8 markets now and 2 more to come over the next couple of years. We've increased our pipeline by further 6 gigawatts under development. We are looking at a few realizations this year and they propose very much following in the footsteps of the journey that we saw in Longroad a few years back. We've established during last year, and it's done fantastically over the last period. This is a new market. In an emerging market, we see Asia following the same footsteps as North America and Europe and its policy maturity. And within Gurin, we participated in the 4-gigawatt tender program that the Singapore government made out, and we are starting our first construction project in that platform. Manawa, following the sale of its retail business, now the largest generator in New Zealand, still maintain a diverse asset base. And now with New Zealand's announcement of 100% renewables ambition, we expect the development pipeline to grow over the next couple of years. And you'll hear more from Deion on Manawa and Mint. And Mint is already [indiscernible] We're excited to reintroduce this in the Australian market with that business, and you'll see a couple of familiar faces with Deion and Infratil on that business. So that's quite an exciting development for the Infratil portfolio. Maybe I'll get Deion if he is around to have a few words about and introduce the Mint business.

I'm not sure if I'm more conscious, but thanks, Vimal. Vimal, I saw him yesterday. I haven't seen him for a while. Hello, everyone. Yes, I'll start with Manawa, I'm probably not the best to talk about Manawa here, but you have a chief Executive. You have the Chairman, somewhere, and they can talk more about it later. But Manawa pretty much positions itself as the largest independent generator in New Zealand. It's got a unique opportunity ahead of itself, and it's gearing up to make sure it delivers on that. So it's quite an exciting positioning it's made and its platform which you'll hear more from them later as on today, but in due course about how that platform of opportunity is growing for them. But I'm certainly happy to be on the board of Manawa. It feels a little bit like coming home. It's out in 2001, I suppose. It's an exciting business to be and got quite an energized team. They realize what they're there for now. There's no complication and they've got a real sort of motivation to get on with it. Mint is though is, what I'm here to talk about more and why did you do that. Go back to Australia. Well, and the theme that Vimal talked about is we have to be ready to respond to markets internationally when the opportunities come up. So if you look at our markets around the world, and you don't include Australia and the opportunities that you're making a mistake that the issue for them is huge, transitioning away from their coal and how to do that was just bulk renewables development is a real problem. So finally, Australia has got federal support. We've been wishing for, for about 15 years and it's got state government support for renewables, the transition in general. But of course, because of all that delay in the confusion and huff free, puff free from politicians over the last couple of decades. The rest of this electricity system is not ready for us. So there's a bit of an emphasis or behind getting renewables in, but there's a delay we've got time to reenter that market and catch up with a greenfield platform development before the transmission system can let us go ahead and deploy it, right? So it's an opportunity that we've seen. We know the market really well. We've been here probably far too long. And we think we can do it differently. We know what might be holding in some parts of the market up, we are through sort of a wider relationship associated with some of the transmission improvements that are not coming up. So we've got some insights. So what are we doing? Well, first thing we've done is we've captured 7 of the best people in the markets that we might have known another platform. We're involved with once over there. And they've come and joined us really excited to try and do the again. We are greenfielding. We're looking at joint development opportunities across mainly the Eastern states and a little bit in WA. And importantly we're looking at what parts of the technology space is holding up Australia. And some people say, it's just Australians, but it's not that simple, right? It's actually the construction resource. There's no one to build that stuff. So how do we enlarge the construction resource or at least capture some of it. So it's kind of ours to use. Grid connection, you've got to watch what's happening in Australia grid connection and think about how that's going to come in other parts of the world like New Zealand. So how do we get the grid connection in-house? Is it worth it? What can we do with it? For example, if we take on the grid connection stuff ourselves, can we get different turbine suppliers into the market. When we say, can you just tell us what you can do with your gear, and we'll take care of the technical stuff. No one's done that yet because it's been so complicated. But AMO is changing in Aussie, and that sort of approach to the world might work if you're a bit bright and if you know what you're doing, which Clyde and I believe we do and can. So we're looking at that area. And funny enough, governments to drive these things. Vimal talked about all the support that's coming internationally. Australia is no different. They drive and stop. Their job is politicians, but there's federal and state government support for offshore wind in Australia which without their support just certainly wouldn't be looked at. So maybe there's a little opportunity for us to have a look at offshore in Australia faster than we thought we might have. And so we are sitting there as open-minded nimble little team with a really, really good experience and an approach that people know, people are seeing it work. And so we have had inbound interest from perhaps some of the large gentailers over there that have been otherwise occupied for a few years trying to do other things like sell themselves. It's really exciting time for Mint. I'm really excited to be the Chair of that vehicle and just get to sort of do what Bruce Harker used to do, just annoy the management team. So can I do it well? I think that's enough for Mint. I think we're open for questions. Vimal, if you can still hear us.

I just really curious to hear your overall view on sort of the cost curve. You've had a 30-year cost curve going down for wind and solar. And we don't really know a lot of moving parts, but it looks like it's a reasonably significant kink in the curve. So do you think we're going to go back to seeing wind and solar prices coming down? Are we flattening out? Is this a new normal? Can the equipment providers gave up for this demand that you're talking to?

I think the answer is yes. I think that the manufacturers are starting to scale up. We're seeing a 3 gigawatt plant being built in Southern Italy to help supply solar panels to the European markets. I think you're going to see more local content requirements. Pro forma, this is going back to the reindustrialization that I talked about earlier of these economies. Yes, significant investment is going back into expanding manufacturing capability. On the cost side, I'm not sure you're going to see a faster fall in pricing. I don't think you're going to see far more efficient equipments being put in for the same price. But there is. You have to remember that all the components that go into the equipment all have alternative uses, right? So the steel, the glass, the silicon, the labor, the land, they all have alternative uses. The capital, which is 1 of the biggest cost drivers of new capacity. So even -- we saw with solar over the last 20 years, it used to make up 80% of the total CapEx cost. So if you saw a 20% reduction in the cost of the solar panel, there was quite a material component of the total CapEx of a new plant, but that's now shrunk to about 30%, there are thereabouts of the total CapEx cost. So a 20% reduction in the price of the panel has a smaller effect on the total CapEx price. And then the rest of the components, as I mentioned, have alternative uses. So I think that you will continue to see some price reduction as the capacity -- manufacturing capacity globally increases. But I think we are going to see a temporary uptick in pricing as the manufacturing facilities are onshore inside of markets because of their concerns about energy security. I don't know Paul was in the audience and on your views that are different. A thing on that one marked up but pretty much, I agree. What we're seeing at the turbine -- wind turbine manufacturers in a way is probably I believe a consolidation for a few years on the current onshore platform size because they're reaching scales where they've become difficult to build. And so they can consolidate their kind of supply chains and everything a bit more, which they do maybe 10 years ago at about 3-megawatt platform size and then they went again. So I think we're in that zone. The good thing about the Infratil group with its global reach is that we are a significant customer for these suppliers, right? So when you come up and say, "Please, can you come and join us somewhere?" They're likely to say, yes, faster than they would say a Mint Renewables standing there on its own as a little player trying to say, look at us, we've got 100 megawatts down in Australia. They just wouldn't bother, right? So I think we -- the advantage is, at the moment, can you get supply, not can you get it cheaply. That's kind of where we're sitting at the moment.

Sorry. Just as more players are entering wind and solar development in investment and some of them have lower return [indiscernible] that potentially Infratil does. How do you think about investing in those assets versus firming assets? Obviously, renewables can be synchronized as well in [indiscernible] and pricing reviews.

Well, it's very much the heart of our strategy. We -- when we set out on the journey we set out to create optionality across various markets. And the markets aren't homogenous, they are heterogeneous. So in some markets, you can still command quite good development premiums. You get -- still get long-term contracts with attractive returns. They do meet the importer hurdles and other markets that will change. So some markets are more competitive than others. Some are still emerging, policies change, regulations change, a result of the competitive dynamic. And by having our regional platforms, we're able to look quite locally where those options are and exploit them and optimize and meet our capital requirements. Hurdle requirements. So we're not in all the markets all the time, but we are creating a group of companies that allows us to find where the pockets of value are and our returns. And you'll see some of that coming out in Europe at the moment. I mean, longer we went through that journey in the first 2 years, and it's got to quite a steady state. [indiscernible] about that, that we still see over the next 18 months, with the first sales coming on the share.

Just another question, I'll go low. But I was just wondering if you could give us a couple of sort of concrete examples of how you're actually expanding that pipeline, like how those development opportunities coming to you? And also the financing of these projects is obviously critical is there any implication from the tightness in the credit markets now or as we look forward?

Sure. So maybe I answer the first question. We are across 8 different markets in Europe. All with each country having it quite significant targets, and those targets have been increasing. So that's giving us some opportunities. We are expanding it to 2 further markets this year. So we expanded, I guess, the opportunity base. We have created a number of joint ventures and joint development agreements with folks in these markets because, again, renewables is a very local game, but you try and achieve scale at a regional level and optionality at a global level. And so those joint development partners and joint venture partners, they have a great experience working with the Galileo team, and then they continue to feed more into the business. So it's -- there is quite a lot of operational leverage in these businesses once you've actually established them. And the marginal cost of an additional megawatt into the pipeline is relatively low, if you can find the right partners and opportunities. Sorry, I forget what the second question was.

Just on the first question. So just to get it right. So in all these situations, you're partnering with people who have -- already have the option on the land for solar or whatever it might be.

Yes, it's a combination of. No, it's a combination of. So some of it you do announce and some of it you partner. So there are some markets that are quite tough to crack. And again, I'm going to use Europe as an example, if you're not local. So having in France, for example, the landowners very much like to talk to rich people. So you need to have a partner in France to be able to access that market, and France is quite a feed market. Germany, somewhat similar. And those opportunities are actually increasing, and I talked about the deregulation that's happening in these markets to increase new capacity to come on. So in Germany, for example, the federal government has turned around and said, "every state now has to allocate 2% of land to renewables." It wasn't the case before. So you had some states doing more and you had some states doing less. So then as that state in Germany has opened up, local people are finding opportunity sets and those opportunity sets are coming to us because we have a local prudence. So we have 3 people on the ground in Germany. We've got a few people on the ground in France, and they're working with these partners and are doing their own development in those markets to grow that pipeline. But once you've got that central capability that it's kind of a hub and spoke model, it works quite well. So you'll see this pipeline that we're sitting at now ramp up quite fast over the next 2 years.

Great. Just finally, it was just the credit markets or the tightening there and what it might mean for financing project.

Yes. So it's interesting, actually, again at this conference, there's quite a few banks. There is no lease up in the commitment to lend into the sector. And in fact, it seems to be a priority in the banks relative to others. The cost is going up slightly, certainly, what I'm seeing here in Europe. But yes, certainly, no lack of appetite. In fact, more allocation to it. And in some places, some banks have actually given like I say, discount to the cost of funding because it is a renewables project as opposed to any other type of projects. But again, we -- I mean, some of this -- some of what we're seeing is still raw. I mean Credit Suisse was only in the weekend row. So some of it's probably still going to filter through into the market.

Right. Quick keep going because it is still a fascinating area and a lot to talk about. But I think when we get here from the Longroad team, I think you'll have very real examples of what's happening in, obviously, 1 of the largest growth markets that we're exposed to. So thank you, Deion and Vimal I should say, Vimal was based in Zurich. So it's an evening for him. So you can see from the fascinating Morrison go-back ground. He's got -- he probably has a better view from that from his window than that. But thanks Donald.

Thanks, everyone.

One of the names. I described it poorly -- pointing it not long enough? Are we on the express train or do we more time? We poorly described we had Paul Gaynor to speak but, of course, the whole -- the senior partners are all here actually with the exception of Pete, and you're going to hear from all 3 of them, not just Mr. Gaynor.

Thanks, Mark. Thank you. So it's great to be here. My name is Paul Gaynor. I am joined by partner #1, Charles Spiliotis; partner #2, Michael Alvarez, the fourth mesquiteer couldn't make it Pete Keel he has got some school break this week. So anyways it's great to be here. So Mark, I just -- we do have the full time? Yes. Okay. Good. So it's great to be here and talk a little bit about what we've been up to the last 12 months. I think the last time I spoke to you all I was in my office in Dover, Massachusetts, looking into some nondescript cameras. So it's great to see you all in person. For those of you who don't know much about our business. We are a U.S. -- we're based in the U.S. We're focused only on the U.S. We are a developer owner asset manager. We have about 160 people. We're doing primarily solar in wind, we -- you'll see that we also have a very big emerging storage piece of our business. We are with -- if you remember last year, one of the things we talked about was making this "strategic shift" towards ownership or more ownership. In order to do that, we needed some capital. We went out to the market last year, as Jason talked about earlier, and we're thrilled to bring on board MEAG along with retaining the great partnership that we've had since day 1 with Infratil and New Zealand Super. So it's a great team. We're all getting along. And we're happy to have MEAG on the train. In terms of what we've done so far, we think about our business as -- so we've done about 4.3 gigawatts total. We've developed some. We've acquired some and we've also sold some. Right now, we sit at 2.4 gigawatts of projects that we own. We also have a third-party business that manages about 1.6 gigawatts of wind and solar assets. So one of the things that we're proud of for the last 12 months, particularly the market context, the market context is we thought we were getting this big build back better program first thing last year, didn't happen until August. And there's still some clarity that remains that we need. We had an inflation -- a big inflation index. Interest rates were up 300, 400 basis points. So in the context of that macro environment, we're really proud of what we did in 2022. 7 projects that we financed, $1 billion -- $3 billion of total capital, that includes the primary capital that we raised and 1.3 gigawatts of new project closing. So it was a big year for us. One of the other things, and Charles is going to talk about this is we made a minority investment in a DG developer called Valta. Something strategically that we're trying to get access to. We realized we weren't the right entity to do it ourselves. So we did it through another entity. The other thing there is the first storage supply contract we signed. Now that might seem like, wow, what's the big deal signing a battery storage contract. But believe me, the battery market, and Michael will talk more about this, is tough. There's not a lot of depth. There's not a lot of expertise. There's not a lot of big AAA credit-rated suppliers. So trying to navigate that -- and again, in the context of this inflation, environment was really, really hard. And we've now not only signed the first one, but we just recently earlier this year, signed a second one. We simplified our portfolio a little bit by selling off early days of Longroad. We bought a distributed generation portfolio out of a bankruptcy of a previous company, 400 projects, about 300 megawatts. We saw -- it was a great financial result for us. But from a simplification of our business model, our ability to now not have to deal with that is really kind of frees up our go-forward plan. And we've had a good pipeline growth. So again, a really tough year macro context, really good results in terms of what we did in 2022. So when you think about what is our kind of guiding principle now. We've made the strategic shift. We've done this first round of capital raising what's the -- where are we going? And the way that we're describing our business to our investors and to our co-workers and employees is we're trying to grow our OpCo to $500 million of EBITDA. How are we going to do that? We've got a combination of projects, capital and execution. So I'm going to talk about the projects. Michael is going to talk about execution. How do you actually do that year after year after year. And then Charles is also going to talk about the capital sourcing and some growth. The 1 thing I'll say is that the fundamentals in the U.S. have never been better. When you think about the demand, and you've got these charts up here, you think about these are out to 2030. So -- and the plus 63 gigawatts, the plus 38 gigawatts and the plus 20 gigawatts is all what is the inflation reduction act on to the market demand. So that's our job is to kind of find with this great set of market -- these market dynamics, our job is to find the best projects in the market to find a capital and to find the equipment that all makes sense and makes economic sense for us and our shareholders. That's where the magic is made at Longroad. It's been talked about by Jason, by Vimal, the inflation reduction act of 2022. I've been in the renewable business for about 20 years. I'm an antique. It is a -- this is a game-changing set of legislation. Never seen anything like it from the perspective of the duration, right? We're getting kind of 10 years of clarity. We've never had that since I've been in the business since 2000, never had it in 20 years. And we're also what I'll call the scale or kind of the punch that it has, right? This $370 billion of capital that is available from the government from an incentive point of view, ITC PTC and some other goodies which I'll talk about. But if you look at the addition, if you think about what the IRA has done in terms of adding to the total demand in the next 8 years, you can see it's added basically 100 gigawatts to the market or just over 100 gigawatts. So it's been great. 65 gigawatts a year. Think about that, like when you're talking about -- we're trying to do -- and I'll talk about a little bit what we're trying to do per year for the U.S. to hit this target by 2030, you've got to do 65 gigawatts a year. Right now, the market is doing about 25 gigawatts to 30 gigawatts in a good year. So the market has to double in terms of the total capacity. We're trying to do 1.5 million. So if you think about kind of what is our market share and what kind of penetration are we looking about, it's not -- look, 1.5 gigawatts is a lot, but it's not -- we're not trying to get 25% market share. There's a lot of players in the U.S. The Inflation Reduction Act. So just to highlight some of the goodies in there. From a policy perspective, what the administration and the Congress was trying to do is incentivize domestic manufacturing. In order to do that, there are multipliers that you can get if you buy your panels from a U.S. manufacturer, if you buy your batteries from a U.S. manufacturer, et cetera. That is a very powerful tool. And what it's done since the inflation reduction act has been passed as there's probably been 15 or 20 large announcements for new manufacturing across the U.S., batteries, panels and other pieces of the supply chain. But you can see what it does. It's an unlevered IRR boost of 4% or we can sell the power cheaper. So that's a pretty significant goody for the renewable industry. The second one is called an energy community adder. So this is for disenfranchise communities in the U.S. that have hosted over the years, a coal mine, a power plant, a coal plant, and they're trying to -- again, from a policy point of view, they're trying to give back to the energy communities, mostly through jobs. So that's another goody. You can see what kind of impact that has. So we've got a couple of projects that are in energy communities. And then the final one is a solar PTC. Historically, the solar has only been the sole projects have only been able to use an ITC. So now that we can use this in PTC in certain parts of the U.S., that makes a tremendous amount of sense and gives us a little boost on the economics. So in summary, game-changing legislation and the U.S. market right now is really hot. The one thing that I'll say is that the rules of the road, so to speak, from the Inflation Reduction Act are not out yet. We think we know -- we think we know what they're going to look like, but until we see the details, which we expect soon, where we're still -- we just still need to see the details. Okay. So let's talk about the projects, and then I'm going to hand it over to Michael. So the first thing is just where do we sit right now, 2.4 gigawatts, 30 projects. This map shows projects that are operating projects that are in construction and also the projects where we have third-party services. So you can see a pretty good concentration in Maine, Texas, New Mexico, Arizona and California and Utah is also a big piece of it. So our long-term vision is to get to long-term 3 to 4 years to get to $500 million of OpCo EBITDA. What we're -- what our internal plans are is to get -- is to do 1.5 gigawatts per year. So right now, we're at 2.4 gigawatts. If we do that for 4 more years, that gets us to 8.5 gigawatts and about just over 500 -- the actual $500 million of EBITDA is kind of in between 25 and 26. So that's kind of the long-term vision. And you can see that we have our 23 projects identified. The 2 projects they are called Serrano and Sun Streams. Both of those are in Arizona. Michael will talk a little bit more about those. And then we have a pool of projects in '24, '25 and '26 to kind of pick and choose from. We've been -- again, with the passage of what we thought was going to be build back better a few years ago. We started looking further downfield on in the development -- in our development portfolio different markets. We're also getting back into the wind development business. So you can see in the last 12 months, we've grown our pipeline nearly 40%. And some great strides in kind of Desert Southwest and in California. And we've also got deals that are now out to 2027 and 2028. Here's our -- right now, that's our current -- our total pipeline is 50 projects. Some of them go out to 2027 and beyond. But you can see if we're trying to do 1.5 gigawatts per year, that gives us some -- we've got some cushion in our development pipeline. And we're also constantly looking at acquisitions. Charles will talk a little bit about that as well. '23 to '25, you can see the projects are concentrated couple in Texas, 1 in Virginia, a big, big effort, a big, big push in Arizona, which has been a very big state for us, Utah and California you'll see the red cross-hatching is solar plus storage. So we've bought -- we've done these 2 solar deals -- storage deals so far. We have to buy for every single project that we're doing there is going to have a battery component to it. So we're going to be -- like it or not, we're in the battery buying business. All right. Let me hand it over to Michael to talk about how we're actually going to pull this off.

Thanks, Paul. Hi, everybody. Michael Alvarez. I'm based in San Francisco for Longroad, and I was a bit taken aback by Paul referring to himself as an antique which makes me a bit of a fossil. I've known him for 25 years. So we're going to have a drink and talk about that. I'm going to start off with some pictures here. I'm the COO of Longroad and responsible for, among other things, procurement. These guys like to tell me I'm the train runner. So keep the trains running. So that's what I'm going to talk about in terms of execution, principally. This picture is in Maine. You wouldn't think Maine was a really solar centric place, but we have a number of projects already operating there. Just to give you a visual of what we have to deal with taking down trees, it's very muddy in the spring. Those are timbers that we use to gain access to the site. This will be the largest solar project in Maine. This is a picture of our -- what we call [ Checker ] substation in Arizona. This is about an hour, 15 minutes west of Phoenix. This entire substation is ours. We do have 1 bay that is for another developer for a pre-existing project. Everything else in the substation is ours. This is 1 gigawatt. It connects to a 9 gigawatt substation, which hosts among other things, the largest nuclear plant in the U.S. called Palo Verde 4.5 gigawatts. What you see here is the Bay being built out for Sun Streams 3. Sun Streams 2 is already operating. 4 will be on the other Catty Corner Bay up there, and we're going to start construction on that Bay shortly. Another picture, this is Umbriel. So you can see the first modules being installed here in Umbriel. One thing I wanted to mention is that these pictures are somewhat dramatic for those of you who have not seen a solar facility, but I understand we're trying to organize a visit to Arizona for those of you who can make it in September. If you can do that, I would encourage you to do it. There is nothing like seeing 700,000 pieces of glass in 1 place, and that's 1 project. So it is an amazing site for you to understand the logistics of the execution of this type of project. Okay. So Paul mentioned what we're trying to execute here $3 billion worth of procurement, not for the fan of heart in a market like this. How do we go about doing that. So our essential thesis here is partnerships. EPCs, equipment suppliers and relationships with banks, landowners, communities and regulators as well as our -- obviously, our customers. I only have 17 people currently working on execution of the construction program. I probably need another 4 or 5 to finish off Sun Streams 4 and Serrano. We do not build anything ourselves. We hire capable people to go do that. We have probably 5 construction contractors that assist us in this. They're tried and true partners. It's an interesting business over time. Construction companies need a lot of backlog in order to operate their businesses effectively. They have a lot of equipment, people. They like to be able to roll them on and off other projects. The way to accommodate that relationship is to give them serial work. There's always the challenge of are they being competitive or are they taking advantage of you. We have a contracting structure that we utilize, which is not lump sum turnkey. It is an alignment interest where we share risk around a target price, but they do guarantee a maximum exposure for us in the contracting structure, and it works quite well. It tends to drive down costs. and more importantly, results in us using very little if any contingency in any of our projects to date. So how do we get around some of the regulatory aspects that have been affecting the U.S. industry. So there is a -- definitely a lot of friction with China currently in the U.S. It's been underway for quite some time. It's continuing on and other aspects of our economy, TikTok is under attack. Now for example. And there has been a focus on trying to restrict the access to Chinese-made equipment for a bunch of social, very good social reasons, slave labor among them. But also just the tendency that it feels as though the U.S. has given a way its advantage in manufacturing to the Chinese. So we had, from a module perspective, which is really largely been the area of where this whole industry has been impacted for the last 2 to 3 years. There were very significant tariffs imposed on equipment coming from China, and there's been an ancillary action dealing with trying to circumvent that where stuff went offshore to Cambodia whatever and was branded Cambodian, not Chinese, and that didn't work out so well us either. So there's been a tremendous constraint on module supply in the United States, silicon modules would be specific. We've had a long-term relationship with the company, First Solar, which is a U.S. company, holds effectively a monopoly on thin film solar technology in the U.S. and globally. And we just acquired our sixth gigawatt which will carry us through 2017, assuming we have a reasonably successful hit rate on our development pipeline. That is not subject to any tariffs, even though it comes from the U.S., Malaysia and Vietnam. -- no tariff exposure. So we've had 0 friction associated with our acquisition of modules. Battery side, Paul alluded to this completely different story. So the U.S. and I think globally, everybody relinquished the production of lithium batteries to China over the last several years. And in January of last year, -- in November, actually of the previous year, so that would be 2020, we signed a framework agreement with the company after we did an RFP called Tauranga, which is really an integrator, pretty much a start-up, to be fair. And what they do is they acquire cells, put them in a box, tie them all together, plug them in, Presto change, you've got an operating battery. The problem is that the Chinese figured out that the EV demand globally, but particularly in the U.S. and for this utility sale storage, gave the opportunity to drive the price up. In January of last year, it increased substantially and forced a lot of renegotiation to make things happen. So focusing on partnerships, we disaggregated that relationship, went directly to a cell supplier -- it's called Envision AESC. Envision is Chinese. ASC is a technology that was developed in Japan by Nissan for the Leaf, the Nissan Leaf EV. Envision bought it, established a U.S. presence now is building factories in Kentucky and South Carolina to deliver 30 gigawatt hours rather of batteries from Kentucky for Mercedes-Benz vehicles and 30 to 50 gigawatt hours in South Carolina for BMW's. We've talked to them about converting some of that capacity to utility scale format. They are going to do that. And by 2025, I expect we'll be buying U.S. sourced cells from ASC for some of the work that's going to come. So a challenge, a huge challenge, again, just a partnership to get through it. We do buy inverters, some inverters from China, but it's from a U.S. based entity. There's some risk there, obviously. The cell thing is a risk for additional Chinese friction. We think we count ourselves in a contracting position to avoid this in the near term, certainly. And then as manufacturing comes to the U.S. will be much safer. And then on the EPC side, I already talked about our contractors. There was a cost. I don't know who asked us about the -- somebody behind it here about the -- like, is this stuff getting cheaper? No, it's not getting cheaper. Part of the IRA, one of the features of it is that we're supposed to use and our contractors are the prevailing wage, whatever that means in a particular region to execute these projects or else, you don't get the tax credits. So that's an evolving situation because the labor markets are not currently structured to enable this volume of labor to come in at a prevailing wage. We've had experience in Maine, for instance, where the government thought it would be appropriate to have an electrician drive a pile. It doesn't make any sense, but that's what the regulators are doing. So there's an evolution going on here. Point is labor costs are going to go up. Prevailing wage is something that you can avoid by not using unions. It does not mean this is union work in large measure it is, but it just means you have to correspond to what folks in these categories make in the area in which you are building. So that going to be a upward pressure. We've got a bunch of folks coming into the business, trying to buy at the same time as we are. We've got a war in Ukraine with people trying to replace munitions and god knows what else out there. There's a huge demand on the commodity complex right now. What we're seeing is an increasing level, and we're starting to index our contracts to some of these commodities like steel, copper, and there is some ability to pass that on to the -- our ultimate customers. So upward pressure on the commodity complex as well. Now going forward, we should be able to push a lot of this cost through to our customers through increased electricity rates and that we've been somewhat successful at doing that so far. So it's not an insoluble problem. But in general, I think we would expect in the U.S. the complex to be rising for some material period of time until all of the market settles down a bit. So whoever asked the question, our answer is it's going to be a bit higher. You're not going to see a declining cost. I would agree with Vimal's comment about increasing efficiency, however. A lot of the stuff is becoming more efficient. So we are buying trackers with U.S. based steel. We're trying to get domestic battery to get a 40% domestic content requirement. We're buying for solar modules. We should be relatively good shape for the foreseeable future. But -- if you look forward, we're talking -- I'm talking about building $3 billion now, $10 billion from '24 to '26. That's a lot of procurement in a very short period of time in a very volatile market. The way to do this is through partnerships. That's the way we execute. I'll turn it over to Charles to see how he's going to get all the money that I can spend.

Hi, everybody. I'm Charles Spiliotis, the Chief Investment Officer at Longroad. Nice to see everybody in person. So I'll talk a little bit, as Michael said, about raising the capital. We are in a very capital-intensive business, 1.5 gigawatts per year is a lot. It's a lot of capital. We took a crack here at sort of what we think it may look like. It will inevitably change, but our program here is about $8 billion between '23 and '26. We raised about $3 billion last year, as Paul alluded to earlier, kind of across the capital structure. The pieces are here sort of shown on the left-hand side of the screen, project debt financing. The debt market is very deep. We generally are not -- we don't have enough room for all the banks, so I would love to participate in sort of our standard project finance deals. Some of the bigger deals that we're doing generally have 6 to 8 or more banks participating. For us, it's hard to manage all those banks. So we try to limit it and sometimes banks are selling down. But that sort of part of the capital structure for us is we continue to see a lot of depth, a lot of new entrants. I think Vimal alluded to this space is a real growth area for a lot of these banks. It's a real profit center for a lot of banks relative to a lot of other industries. Not as much excitement about real estate and other parts of the economy in the U.S. Ours is certainly an exciting part on a lot of fronts. So that part is good. Tax equity financing over the whole time that I've been in this business has been sort of a complex market to understand. I think the good news for Longroad track record is incredibly important to the tax equity market. They generally have a limited amount of humans to do a certain amount of deals per year. They have a limited amount of tax capital that their treasury departments allow them to deploy. And so there's just not a lot of benefit in bringing sort of smaller developers, smaller deals, that benefits somebody like us. And we have sort of gone back to a lot of the same institutions again and again. Michael, I know alluded to deep relationships. I mean, we certainly see the same thing on the financing side. We're trying to do repeat business with a lot of banks and investors over the years. KeyBank is one of our best banks. We recently cleared $4 billion of transactions with that bank alone, which is just pretty amazing. But on the tax equity side of the market, the trends that we've seen, all the big banks, the Morgan Stanleys and U.S. banks and JPMorgans of the world have been the big players. Then the next sort of phase has been bringing a lot of big corporates in the U.S. that want to participate. But the structures that tax equity requires in the U.S. are pretty complex, partnerships and inverted leases and very sort of esoteric tax structuring that's pretty hard if you're a big supermarket or a big electronics supplier or something like that to understand to sort of justify spending the time on. So that's been a big trend is sort of syndicating down to some of those corporates to allow them to participate in the market. That's been a pretty welcome change because it does create more depth, which is something that is pretty valuable to us. And I think the other big change on the IRA side with the tax equity market, the intent of the legislation is really to try to allow more participants in to the market those complex structures that I mentioned, and that is done through this concept called transferability, which really lots of different types of tax credits. It's a pretty simple contracts, right? So if you want to use the tax credit offer $0.90 or $0.95 on the dollar for that tax credit and you can sell it to me, right? That has not been an option in the U.S. We are still waiting for this treasury guidance to understand a lot of the details. I think our expectation is that will -- if that market works, it will benefit more of the smaller developers, smaller projects that don't have the capability and sort of the economics aren't as exciting to do a 5-megawatt deal tax equity deal. It's very complicated. There's a lot of lawyer fees and bank fees and all these things and transferability would really create a pretty efficient way for them to finance those deals for a project like ours, $500 million project, we expect that the current tax equity structures will likely remain as the most economic and viable option for us at this scale. The other thing I didn't mention, obviously, $1 billion is sort of the equity requirement, the sponsor equity requirement that we need in order to execute on this plan that we've laid out. So it's a pretty big number. There's a lot of different ways for us to potentially finance that. Obviously, we could do it through corporate equity, ability to -- we don't have a lot of debt on the corporate side of our business. So there's sort of OpCo debt capability. Obviously, we can sell down assets in part or in full, and we'll be -- as that OpCo grows, certainly more distributions for us to be able to reinvest. Next up, development. So this is a little bit of how are we going to be able to execute on 1 gigawatt in half a year over a long period of time. This is sort of the big strategic initiatives, strategic opportunities for us that we're excited about. I think the first bullet on here, Paul alluded to it earlier, I think it was sort of 2021 where we sort of looked around and said, these interconnection queues across the country are getting so long, and we have this goal to try to do bigger volumes, own more? How are we going to be able to do this and really pushed our team to go deeper. And we really started to invest for projects that are very far out there. A lot of the queues in the U.S. So tomorrow, I have a piece of land, and I want to get into an interconnection queue to be able to connect to the grid someday. A lot of the markets in the U.S., I can take 7 or 8 years to go from putting it into the queue and getting an interconnection agreement executed for a project. So that's a long time. That's a long investment horizon. Obviously, the IRA, Paul talked about the duration. I mean, that's a big benefit. It's pretty hard to invest since I've been in this business since 2007, very hard, we've never had probably more than 3 years at the most. So pretty hard to invest large dollars of our project that's 8 years away when we only have 3 years of certainty on an incentive regime. Those are a big benefit for us. I mean, to give you an example, we're putting projects in the queue now in California, multi-gigawatt sort of opportunity. And I think we'll be very happy if those projects could achieve financial close before the end of the decade. I think that would be a pretty good outcome. So certainly, that pipeline has grown a lot. It's also gotten sort of deeper, longer duration. So those are -- that's something that certainly has changed as we've approached sort of this new strategic -- these new strategic goals. Winds, Paul mentioned this as well. Over the last 3 or 4 years, sort of the wind versus solar versus wind versus solar and storage, led to the economic proposition before the IRA. It was not very compelling in a lot of markets in the U.S. Certainly, there were some deals that folks have been working on for 5, 6 years that were more mature and tax credits were available that still were economic, but in terms of starting today, investing in new projects much more compelling from a dollars invested versus potential value to put those dollars into solar and battery storage. But the IRA has really leveled that playing field. There's a lot of places in the U.S. where wind is a very attractive proposition. The economics are very attractive. The utility off-takers have a strong desire for balance. So that's certainly a big push. King Pine Wind is our biggest one. This is a project that -- we were actually working on before Longroad existed in a prior life, and it's core to come full circle. But just to give a sense, we're trying to go bigger in a lot of places. King Pine Wind is about 200,000 acres, 1 gigawatt wind project, which we were awarded by the State of Maine at the end of last year, a lot of risk, early stage, a lot of work to do, but 200,000 acres just to give a sense of the size of these projects. I looked it up because I'm not great at the metric system. It's about 800 square kilometers. It's a pretty big project takes at least 2 hours to drive from one end of the site to the other. We're doing something similar in Arizona, not quite at that scale, but in terms of multi-gigawatt opportunities at the same site, much like we've done at Sun Streams, right? Sun Streams has been an incredible success. Finding a really important area in the grid, really important area where we can invest and kind of grow out multiphases. I think that's sort of one key way that we're able to achieve these growth objectives that are but are pretty large. I think stand-alone storage and hydrogen, there's a lot of buzz. I'll talk about Valta in a minute. But in terms of the Longroad side, we now have a pretty strong pipeline of stand-alone storage projects on our own. So many companies in the U.S. are just focused on stand-alone storage. They're building out sort of analytics and trading and doing merchant opportunities. Our approach has been a little more cautious. We're focused on places like California where utilities need storage badly for the system and are interested in doing long-term tolling arrangements. Some other parts of the country, Arizona, like where we're doing the same thing, where it's a very similar regime. We're sort of doing the market analysis to see whether those sort of more merchant type of opportunities could be a fit as well. But it's a fast developing market. Access to the equipment is very difficult, in addition. And so that's something we're spending a lot of time on. And then the hydrogen side of the business, again, we're certainly in the infancy, but we are actively working on the renewable side of it. So building wind and solar to power hydrogen, right? So there are some real opportunities already in construction and they need lots of renewables to green up to hydrogen. So that, I think, no doubt will be part of our business over the next 5 to 10 years, whether we also want to develop our own hydrogen, by electrolyzers and build a huge green hydrogen complex. I think that's [ TBD ]. Circle back next year, see if we've made any progress on that. But these are sort of big picture growth opportunities that we're -- the team is spending time on, excited about. And then the last one, again, how are we going to get there? Arizona, we mentioned this. So we've done 3 in a row. These 3 contracts in a row with Arizona Public Service. It's just -- it doesn't seem possible to get to the volumes that we want to get to without really deep relationships with utility, corporate counterparties. Arizona Public Service is the biggest utility in Arizona. So these 3 projects, as we alluded to, represent over $2 billion of investment within a relatively short period of time. And the reason that they want to do business with us is we've been able to execute, right? So the U.S. is incredibly competitive, how do you differentiate yourself one big way is just actually to do what you're going to say I mean to execute on what you said you would do, which a lot of companies in the U.S. are starting out and want to prove themselves and commit to some things that they can't execute on. And I think we're trying hard not to be that. And I think so far, that's been a pretty big competitive advantage of Longroad. I think I'm getting close to exploding. I have 1 minute left I should be worried about? Yes. Okay. So Valta, Jason alluded to this in his remarks as with Paul, we spent a bunch of time evaluating should we do this in-house. We did, as you saw on the board earlier, the map. We've done, we've dabbled with some of these 5-megawatt projects at a time. I think we certainly found that our team is not that big, and we're cannibalizing our own utility scale business, and it doesn't make a ton of sense. However, this is a really big market opportunity in the U.S. The IRA, we said that -- Jason said that we raised our capital sort of right before the IRA. We also made this investment before the IRA, which is probably beneficial to us. This is a company that has been around since 2009. They've never raised any outside capital. So they've been doing sort of 1 small deal at a time, recycling the money, go-go-go and they too saw this big market opportunity and we are looking for a partner. And we really view it as they have a dominant position in Los Angeles market, which is a great market, one that we worked on the utility scale side, a ton of credibility in Massachusetts, where they've had a lot of success. And those markets are -- power prices have gone way up, which is great for sort of unit economics and the markets are very deep. So we're excited about this business. The hydrogen piece, I could probably spend a lot more time than 0 seconds that I have left here to talk about it, but they're doing really interesting things in terms of site by site in California, putting solar next to the electrolyzer to make green hydrogen, selling that hydrogen for trucking, putting excess into the fuel cell. It's very cool. They just -- they received the first discretionary permit in California to build one of these facilities. And certainly, the hope is build the first one and then talk about what a great outcome it was for a lot of other municipalities and repeat and repeat. Do we want to do questions or?

Yes, we do. We just have 1 more slide, but...

Sorry, sorry, conclusion. Sorry. Apologies. I think I won't go through these, but I think one of the things maybe captain obvious here, but our ability to actually look further down the field and look at some of these adjacent ideas like Valta and hydrogen. We couldn't do it without the perspective of our shareholders, right? That's what makes it work. There are -- and I do think that is one of our biggest competitive advantages in the U.S. There are a lot of developers that are owned by private equity to that investor class typically has a shorter view on life or let's do as much as we can in 2 years into public, right? We don't have that constraint. Now we've got to go raise capital, of course. But we also have the benefit of 3 very well-capitalized, very sophisticated institutional investors behind us who are supportive of the strategy and are giving us the freedom to do it. So that, to me, is a huge competitive advantage, and that's really what I think why we've been so successful. So I'll stop there and maybe we'll take some questions. [indiscernible], are you?

Yes. And just a couple of quick questions from me. Just on the 6-gig thin film solar agreement that you've got with First Solar. Are you -- offer us on price and delivery time frame there? Or does it depend on new plant -- the new plants coming on in 2023, 2026? Are they firm on price and delivery time frame? And secondly, what percentage of that capacity will stack fully to the IRA benefits that Paul, you talked about. And just last one on the MEAG transaction. Can you give us some idea for whether or not they bought into specific projects or at a [indiscernible] level?

Let me just do the last one, [indiscernible] level. So they're invested across the entire company. I'll do the First Solar one. So we have a framework agreement that is a very flexible instrument and we can add capacity onto it by mutual agreement, obviously. It depends on the technology road map as we go forward as to what volume we want and what model we want. So most of what we're buying now is what's called Series 6 plus. There's a Series 7 coming out of a larger format that we are interested in deploying, and there'll no doubt be Series 8 and Series 9, et cetera. In terms of the price that is fixed, there are a couple of adjusters that relate to the commodities that I was referring to earlier. So there's a little bit of aluminum in the frames of these things, a little bit of steel. It's not a large driver, but it is something that we work with. There's also a transportation adjuster, but I didn't mention when we go U.S. here, largely, our transportation risk is mitigated. It's basically trucking and rail and not a lot of international exposure. So the price is fixed. The volume is fixed. We work together on a quarterly basis to forecast the utilization. And we can then -- as we get closer to deployment of the modules, we refined delivery schedules down to the week and how many modules per week and so forth. But it's an extremely long and trusting relationship, and we accommodate each other. We're trying to marry remember a business that is spinning modules off like every 2 minutes, and they want some place to put them. And we're sitting here figuring that how to do a 500-megawatt project, and we've got a permit, we got to get. So it's hard to marry those together without a partnership that has a lot of flex and trust.

I just had a few questions around the IRRs and the benefit of the IRA. If you had to slide up there, which I think went through the 3 categories and...

Yes. There's more. Those are just 3 examples here.

Three examples here because obviously, the storage on top of that as well. And obviously, those numbers are unlevered, right? So obviously, looking at the financing structure is quite a lot of debt in Longroad. So just been some kind of what is the kind of IRR kind of uplift when you're doing on a EBIT basis? And then just some assumptions around that, like do you assume that some of those excess IRRs get competed away later on in terms of lower PPA prices or what kind of period would you kind of expect that to happen?

Do you want to?

Yes. yes. So it's more on a levered basis. I don't necessarily want to flash that to the folks that might be looking. But we do expect some portion of that gets passed through, right? So we're not expecting to realize 10% additional for sort of new projects going forward. Obviously, the utility off-takers and folks are pretty well aware of what those numbers look like. And so I think there is some effort to try to share, right? That's generally been the way that it's operated so far. For example, domestic content is it unknown? What do the rules look like? How is the access to equipment, those sorts of things. So it's -- those are the types of things that we're trying to avail ourselves of and happy to share it with the offtakers. I think that's probably the right outcome is some combination right of the PPA price differential that we flash and the IRR pickup, that's probably been, I think, most commonly, what's happened thus far in the U.S. Of course, some projects just got the benefit of a couple of our projects. Just fortunate timing, right, where we were already contracted on the revenue side, close to starting construction, we've been able to avail ourselves with some of those benefits. So that's certainly been.

I think the other obvious or maybe not so obvious is that every single project that you see every dot on the page, all -- every single one of those projects is competitively bid, right? So we're not doing, I don't think we've ever done a just a bilateral deal, right? So there always has to be some kind of a competitive process. And therefore, that is what keeps you honest to figure out, okay, how much of that unlevered IRR am I going to keep and how much price am I going to share with the customer, so. Yes. The question was, when does the detailed guidance is it -- when is it expected to come out? Our expectation is that it's going to happen sometime in the second quarter or this year, so soon.

And sorry to follow up on the on the same group those markets. So obviously, you could have a 30% tax credit, but it could stack up to 50% plus. So obviously, when you're competing on a project, if you get local supply, you've got 1 of those low-income areas, then you can obviously.

That's what makes us competitive or can make the difference between if you're competing with someone who's not in an energy community and you have then the pricing power to offer a lower price. So that's turning into a pretty key aspect of our development focus, finding those spots.

Just back to the -- I think 1 of the original photos was of a project in Maine, which I assume the wind.

Solar.

Solar, sorry. How do you sort of, I guess, count the environmental argument about cutting down a Forest and put in a renewable project and any backlash to it.

It turns out in Maine, there's a lot of timber management already. And so our sites are typically forest timber management sites, and we're helping actually some of the logging going on by cutting down some of the trees. But I think the wildlife argument is much more fundamental there. What are we doing with fish, bats, different species that are out there. There's a lot of work that goes into evaluating, doing testing and management of the site in order to accommodate everything that's already there. But I think the question that I would say is we're being much more resistance than in Maine, cutting down trees than we are in some of the ag communities where there's a principal agriculture as the dominant economic activity and are we taking land out of production. That is kind of an interesting challenge that we're seeing.

The King Pine project that Charles mentioned, the 200,000 acres is 1 land owner who is 1 of the largest timber companies in the Northeastern U.S. That site is not kind of virgin forest, right? It is an industrial -- if you go up there and drive 40-foot wide roads, a lot of environmental damage kind of already done through the logging operations. So those are typically the best sites that we're -- that's what makes a lot of sense to recycle some of those industrial logging operations into either solar or wind opportunities.

But Michael, this I think is for you. We did a tour last year to Maine and [indiscernible] from Manoa, which is an outstanding thing pretty much. I mean what are -- a simple question I'd ask is not very sunny in Maine. And so whereas, of course, down in Arizona, it's just an always unlimited resource. I mean, how does that actually play out really? We were a bit puzzled.

Yes. I think the simple answer is it's not as sunny in Maine as it is in Arizona for sure, actually. However, power prices are a lot higher and renewable energy credits are a lot higher. So the product that you're selling is worth more and it's worth more to the extent -- I mean to actually make the projects economic. So that's a big difference. It's that simple.

The other irony is, yes, it's sunny in Arizona. And at noon, there's a lot of sun, so there's a lot of power. And they don't need it then. So now you've got to put a battery in and move it from 4 to 8, right? There's a time shifting that goes on. So it's a pretty complex market driven in large measure by the prices.

I'd do 2 more questions, and we are going to go to lunch. And you can grab the guys then because I know to be lots of the questions. Nevill?

Okay. This might be going back to basics a little bit. But I'm wondering if you can help clarify when we're talking about the run rate for OpCo EBITDA. We're talking there about PPA revenue, less cost of funding side and there is overheads. I presume that's the correct definition there. With the complexity of the tax structures, et cetera, how should we think about the run rate for operating cash flow for Longroad on that same time frame?

Yes. I mean, clearly, a lot will depend upon the capital structures that we utilize. I think -- I don't think we're sort of advertising specific numbers because those pieces are still in flux. For example, Paul talked about the solar PTC, right? If we do a project with, the solar PTC has quite a different profile than the solar ITC, right? Tax equity investor takes less cash. The tax credit is annualized, right? So there's -- I think there's a fair amount of complexity for us to be able to forecast that. So I think a little bit too early for us to have a really tight view on that. The sort of EBITDA number is much more straight forward. It's based on, as you said, actual PPA prices that we have a pretty good sense of, operating costs that we have a pretty good sense of. But the capital structure and the tax credit regime, all this guidance that we're waiting on, I think that will have a pretty big effect on the operating cash flow piece.

And just a follow-up then, when should we think about the business is effectively becoming unencumbered of those structures? Obviously, you try to return guarantee of terms to tax equity partners, et cetera. For lack of a better word, when does that flip occur on average across the portfolio?

Yes. So I mean we're -- for the solar and the storage, we're generally expecting in year 6 or 7 to buy out the tax equity investor and get them out of the way and have a very simple, nice and clean structure. For the PTC deals, right, we would expect at year 10 to be able to do that. So that's been kind of the base case and I think will continue to be so.

Okay. So we might -- I'm only conscious of time because I know after the afternoon, we've got some who are presenting that need to be on flight. So I don't want to cut into that either. So thank you very much, I know you take down some time, but thank you guys for presenting.

All right. We may make it start. Paul Newfield doesn't need an introduction from me. So thanks, Paul.

To repeat the common theme, it is really good to be doing this in person after years of doing them on Zoom. I must admit I was nervous coming here this morning to see if Jason Boyes had remembered that need to be long trousers. I can tell you, it doesn't always remember in the office, but yes, good that he remembered people would see his whole body today. When -- I was thinking back actually when I saw the track record slide that Jason put up at the start for Infratil. In 2007, when I met Lloyd Morrison, and Infratil have been going for 13 years, then the track record is 18% per annum post fees and taxes since inception. So it's really nice to see it at 18.5% now. I think in the years I have been at Morrison & Co, when I joined in 2008, people would say, it's been 18% per annum, but that's all Trustpower and Wellington Airport. So those are the 2 assets that matter. And then it was actually Z. Z gave you this little kicker and that's how you've done it. And then it was -- actually, it's all CDC, and then it was all Tilt. And now it's all Longroad, still CDC. And so what you look at when you look at actually all of that for 29 years is actually the biggest asset is the people. And that's not just the Morrison & Co people. Clearly, it's people and relationships right. So it's the Infratil Board, it's the Morrison & Co team, and it's a portfolio management. And if you think about the relationship between those people running the portfolio companies, Morrison & Co and the Board, that's actually how you get that track record for so long. So I want to spend 10 minutes talking to you about that asset in the portfolio, which is the people. Conscious that we don't talk about Morrison & Co publicly very often, so give you a little bit of an update on our business. We -- consistent with what you've heard today from Infratil, it feels very global. That's how our business feels today, sort of touch over 175 people, probably head towards 200 this year. Those people are increasingly globally spread. I'll talk a little bit about where they are. And importantly, for Infratil, that is one team. So it's not like there's an Infratil team of 15 people in Wellington. Infratil has access to every one of those people, and you can always get the right person on the right asset at the right time. And as Dan alluded to, you also get all kinds of insights from the things you do that aren't just for Infratil. So when you own part of a large transmission distribution network in New South Wales, you get insights into where you should be building renewables. If you own fiber businesses in Spain and in North America and Australia, you get insights into where is the value and the fiber that sits inside the Vodafone business, the one New Zealand business here. So that is where the magic happens for us. It's that broad reach seeing everything. So what I want to share today is really 2 things. One would tell you a little bit more about that team and how it's growing. And then secondly, share some insights we get from the fact that we now do have that global view and are looking at things so much more broadly. First of all, our Board. These slides don't have every face in the firm on them. It's quite hard to keep it up to date, but I'll try and as we go through try and highlight a few faces to talk about. Some of our Board, you will know well from the long involvement in Infratil, people like Duncan Saville, Rob Morrison, Anthony Muh and myself. And then we've added people more recently as we have globalized. So Damian Roche, it's been his executive career in global roles for JPMorgan, now the Chair of the ASX. Kate Mingay, who I think introduced in the virtual version of this last year, U.K.-based director, has spent her career all around energy, transport and infrastructure in Europe, both on the government side and the private side. And News Director actually announced yesterday, officially starts 1st of April, Geraldine Buckingham. Geraldine's an Aussie, who spent most of her career in New York and Asia, is now based in London. Most recent job was being the head of all of Asia Pacific for BlackRock. Before that, she was Global Head of Strategy there. And so going from a -- the perspective of being the world's largest asset manager to sitting around the Morrison & Co Board really helps. And actually this week really helps because she's also Director of HSBC globally. So you get a little bit of insight into what's going on in the global banking system. So really, we have tried to evolve and always stay ahead of where we need to be by getting that global expertise around the top table. Then, may be to step into some of the regions. This slide, the faces in yellow here are the folks who are based around Europe. Most of them are based in London. We do, as you saw with Vimal, have folks in Zurich, Italy and France now as well. And if you think about the background, we're also like ahead of [indiscernible] centers, a Dutchman who like utmost -- Dutchman speaks about 5 languages and is very at home everywhere. So a team now in London, which I think is at scale of any global infrastructure fund manager in the world. Similarly, if you look to our folks in the U.S. or almost all on the island of Manhattan, a combination again of great Kiwis and Aussies who have gone up there to carry the culture with people from some of the best U.S. institutions. So Perry, who runs that business used to be the Head of UBS Americas for infrastructure. We've got Melissa who's just joined us from a very senior global role at Brookfield; Lauren, who joined us from Carlyle. So you've kind of got all of the U.S. brand names, U.S. networks intermingled with this Morrison & Co DNA. And increasingly, for us, in the next year, what you'll see is us adding the American version of Bruce Harker or Marko Bogoievski, if you can imagine such a thing existing. Those people with the real operational experience in the sectors that we deepen, and some of those faces are already on this page. So it feels pretty cool actually. You think like this is a New Zealand company, but is genuinely a global leader at what it does. And when I think about Infratil, I always think about my mom, the retired school teacher sitting there with her savings and Infratil she is, having access to what that global team of 175 brings and then what the global team of portfolio CEOs and management teams bring like. You sit here listening to the Longroad team and you're kind of amazed. You think like New Zealand retail shareholders have got access to that and exposure to that. That is very different from pretty much anything else you would see in the market. So there's a little update on where we're at. And I think you'll -- you should just imagine that we will continue to keep investing in our team and talent to stay ahead of the demands of Infratil. Then switch to the other side of the equation, what are we seeing globally in the infrastructure market? This chart, the same data you saw from Jason earlier, this really big flow of institutional capital globally into the infrastructure sector as Jason said in the last year, actually more inflows into the sector than global real estate, which is quite incredible. It did really start to decline in the second half of 2022. So 2022 was a world record historical year, but it was pretty much all in the first half. We definitely are seeing some of that slowdown. So why do institutional investors like infrastructure? Inflation, protection, recession resilience, all of the things which you ought to want more of right now. And we expect we'll keep seeing that. I think it will slow down a little bit. If you think about how institutional investors think about infrastructure, they've got -- you've got real estate on one side of you and private equity on the other. And I would say in the next 12 months, it's going to be tough times in big parts of real estate and tough times in private equity. So when your neighbor's houses are on fire, you get a little bit of smoke in your drapes. It might not be the best to have an open home. But I do think, to the extent that infrastructure really delivers what it says on the tin, and not every infrastructure asset will, but to the extent you can really deliver recession resistance at the same time as you give inflation protection, I think you'll start seeing more capital come from real estate and from private equity into the space. So expect that to really bounce probably give it 12 months, 18 months, depending on how markets perform. Then if you flip that around from the institutional side to the fund manager side, why are fund managers getting into this space? And this is something we're really seeing. When we want to put someone from BlackRock on our Board, Jason asked [indiscernible] permission. Why does Larry care about someone going to work in Morrison & Co? Because BlackRock is world's biggest fund manager, really wants to grow on infrastructure. KKR really wants to grow in infrastructure. All of these global fund managers want to grow here. And why is it? Long time it's been a consultant, but I still can't resist 2x2 matrix. The chart on the left of this slide shows you average fees versus average growth in funds under management by product category. And so managers have been traditionally in that U.S. active equity space, finding a lot of fee pressure, slower growth and want to get into alternatives, and infrastructure shows out as the highest-growth segment for them and still a high-fee segment. I will point out that the Infratil one would be in a different quadrant there if you're looking at Infratil fees. But certainly, in the U.S., internationally, we're still seeing people commanding on a private equity sale fees, 125, 150 basis points, but with that massive inflow of a new product category. So that's why they're all getting into it. And on the right-hand side of that chart, you see some of the mega funds that closed just in the last year. So you've got people like KKR closing an individual infrastructure fund at USD 17 billion. I think this year, we'll see a Brookfield one that will be north of $20 billion. Stonepeak will be pushing up to those numbers and some similar numbers. So when people are raising individual funds with $15 billion, $20 billion, they want to do a lot of deals that are $1 billion, $2 billion, $3 billion equity checks, which actually is a great thing for Infratil because when you think about what Infratil does, often it builds and creates these businesses like Deion and Clayton's business, Tilt, that then do reach that scale and become really desirable to some of that market. So then how do we remain relevant in that world? And [indiscernible] Morrison & Co, you think we're early to the space, but how do you just avoid being crowded out? All we really have is our track record. It is your calling card. And particularly, if you think the Infratil track record is public, all of our worst deals that are in it and all of our best deals are in it. So no one has the due diligence for weeks to understand that. You can actually just look at that return. And so that's why no matter how big Morrison & Co grows, Infratil will always be incredibly important to us. It's a calling card. And I think if you ask any Infratil director, they will see this Morrison & Co people will crawl over broken glass to deliver for Infratil because the rest of the business falls apart of Infratil doesn't deliver. So here's the -- we've got data on as far as we could find every infrastructure fund in the history of the infrastructure sector. Interestingly, the data fit starts in 1999, and Infratil, of course, started in 1994. So it tells you Infratil was early. And if you look at Infratil's return since inception at 18.5%, it's right up at the 85th percentile of all funds ever. And remember, they've been doing it. These are typically funds that run for 7 to 10 years. So to maintain that for 29 years is something really special. In the last 10 years, obviously pushing towards 20%. So to us, this is the most important thing, preserving that track record and enhancing that track record, and that's why you see us invest into it. Last thing I was going to cover and hopefully give a little bit of time back to the day was given that we do now have this global breadth and we are seeing a lot of deals and we do deals that aren't just Infratil deals last year -- the deals we did last year, probably 1/3, 1/3, 1/3 across North America, U.K., Europe and Australia and New Zealand. And obviously, a lot of that wasn't just for Infratil. But it does give us this privileged spot to view what's going on. Sitting here today, I would say we are in choppy waters globally. Clearly, we can all spot that. What does it mean for infrastructure assets? Rare, high-quality demand assets are always going to be in demand. And particularly, if you can show you have inflation protection, you can show that your volumes won't go down materially in an economic downturn. And you can show that you're a platform that you can keep reinvesting in and growing. I'm not kidding ourselves that every asset we own will prove to be that, but the ones that do I think will be really attractive to people. But we're in a capital market like everyone else. So what are we seeing right now? A lot of institutions, superannuation funds in particular, talking about what they call the denominator effect, which is they aim to be, say, in Australia, it's normally 10% infrastructure. U.S. might be 3%, 5% infrastructure. So when your equity portfolio goes down, your bond portfolio goes down, all of a sudden your overweight infrastructure. So that is slowing things down. We're seeing people say, you know what, I'm not going to pursue that opportunity, talking to people who start on Monday with 10 deals on their list and say, actually, we can only really focus on 3 of them. So that is definitely going on, and that is creating fragility in some transaction processes. So we are seeing processes that in the past, you'd say I'm not even going to bother participating or in some cases where you say, I'm not going to put an indicative bid you write them on, so I'm not putting an indicative bid. We don't think you need us, and you get a call back a month or 2 later. So that is definitely changing. To the extent that you're well capitalized as Infratil is and where you're in sectors where you really can have conviction and confidence in what you're doing, I think you will get opportunities to take advantage of that to act decisively when everyone else is nervous. So I think -- probably if you think about the last few years, we've had this really strong bias, right, Jason, towards building businesses rather than buying them. Think about it, we've built Tilt, we've built Longroad, we've built 80% of what CDC is today. I could imagine in the next sort of while that could swing back and you say, actually, now is a great time to be buying, not just building. But that remains to be seen. Who knows. Maybe the world somehow navigates this path. I don't think we're going to see blood on the street. So I made the foolish era of moving to Australia in 2010. Remember Lloyd Morrison was shaking his finger at me and saying there's going to be blood on the streets. [Indiscernible] [ Old Coast ] gone, [ Macquarie ] is close to dying. You're going to buy all these assets cheap. We know those great assets people don't give up, if they don't have to. So we're not expecting some kind of, yes, [indiscernible] experience. But we do think there will be good opportunities if you've got capital and you've got conviction, and I think that's what Infratil has. So that was all I was going to say, Flesh. Happy to take questions if there's a minute or 2 but...

Yes, a couple of questions, if there are any.

Paul, thank you for that, very insightful. I'm actually really curious how you sort of think about or decide what assets are suitable for Infratil versus some of your other collaborative management mandates that you're having. When do you think is it a good asset for Infratil, apart from, obviously, if it's a great asset, it goes to Infratil. But any other consideration?

Yes. I think the first thing to say is you did right, like Infratil has the right to see everything we do. So the Infratil Board never gets surprised about something. We do get an Infratil Board with a recommendation on do we think this makes sense for your portfolio or not. And that's usually around -- all the things Jason described around the portfolio strategy, the return targets, how much yield do you need versus growth that's always, yes, that shifts around. The other element of it is Infratil state the obvious, is a listed stock. So there's only so many sectors and ideas you can have on that before you just start creating a discount because people aren't going to do the work. So you do see -- I think Jason and the rest of the Infratil Board set a really high bar on introducing new sectors relative to investing in your existing business or another business in the same spot. So I think that's an overlay that's probably unique to Infratil. Other than that, it's -- that trade-off between how much yield do I want, how much growth and how do you deliver that overall return target that Jason [indiscernible] target.

The definition of infrastructure has kind of broadened over time. Just wondering what your thinking is on how it might continue to evolve over time for Infratil group?

Yes. I might first say how I think it might for the market and then how it might for Infratil. I think for the market, it has definitely broadened in the last few years. Sometimes for good reasons, sometimes for bad, like just the weight of capital and free money, has meant people have gone looking outside of their normal areas. I don't think that will all end well, yes. Whenever we break new ground like diagnostic imaging, we say we've got to really work hard at making this work because if we do well, it will become mainstream, and you'll have a whole lot of people buying up these assets everywhere and valuation being pushed up. If we don't do well, everyone will say, look at those idiots, it was never infrastructure. So when we bought CDC, we got a lot of look at those idiots, that's not infrastructure. And now it's data saying this one is most sought after -- sought after class because that's performed. We do need to make things perform. So I think there probably will be a bit of cleaning out in the next few years of some things that don't go well for people and they don't choose not to go back there. I think for Infratil, I'm more interested in those thematic spaces than really hard boundaries of risk return. When -- Longroad was a great example, right? When you heard the guys talking about how they're starting to explore distributed generation and hydrogen, because they do what they do so well, they can assist those things on the boundary, really understand them, take them in bite sizes and expand. I think that's probably the way we'll expand. We really have expertise either within Morrison & Co or on the portfolio team rather than saying, let's just pick out a whole brand-new space. And as you also heard from some of the team, whenever we've gone to these new spaces, we've probably spent 5 years working on them already. So you'll probably have heard in some of these sessions us talking a little bit about some of those ideas before they pop up. Certainly, the Infratil Board usually has heard about them for several years [indiscernible] before we have a recommended investment.

At the beginning of the day, the tax return was 11% to 15% and that you've got a chart there showing sort of 18.5%. And over the last 10 years, it's been really strong. What's changed? What's changed in the market, particularly given that at the moment, there's potentially opportunity that you might be able to pick up some assets cheap?

Yes. I would say nothing. We targeted the same range back then. And in fact, every investment committee paper that's ever come up for [indiscernible] I think the highest number I've seen in expected return was 16.5%, which was CDC in 2016. And that's turned out to be, whatever, has been 40%, 50%, right? I think our job -- if you start trying to push too far, you do take on risk and do silly things. So our job is usually to find businesses who we think will have a downside protection at about 8%. You've got high confidence in the mid-teens. And then you've got optionality because you're in a good space, which is what pushes you above that. So hopefully, 10 years from now, we're still looking at 18.5%. But I think if we've told you we were going to target that, there's a risk that we take on too much risk.

Thank you. I like the, what was it, drapes and smoke. I can just see a research analyst here. You scanned everyone, but okay. Thank you.

Thanks, Flesh.

Right. I'm going to welcome Lewis Bailey onto the stage. Lewis is -- I think his title at the moment is Acting Head of Strategy. But Lewis does a lot of things as many people at Morrison & Co, your title seems to change daily a little bit with what's required to be done. But Lewis has been involved in the digital and telco side of the business for the last few years and -- including involved in transactions as well. But he's going to give us a little bit of background around -- thinking around this space and why we are still excited about it. So welcome.

Good afternoon, everyone. It's my pleasure to introduce the digital section of the day. Thank you very much. And to give you a bit of a whirlwind to -- I've been told, keep it quick. So my plan is just to talk very fast. I also will get the pleasure of introducing Greg Boorer, CEO of CDC and also the Chair of Cricket ACT, who I've been told is going to hit it for 6; and also Jason Paris, who's, of course, the CEO of One NZ and our greatest host today, although I don't have a suitable sporting pun for him. Digital infrastructure assets now comprise over 50% of Infratil's portfolio. And that wasn't always the case, of course. When we started to invest -- Infratil started to invest in CDC in 2016, it was really not recognized as a core part of infrastructure as an asset class. And you can see the enormous growth there's been and the maturity in that sector across data centers, fiber optic cables and towers and others. And of course, Infratil shareholders have really benefited from that recognition of these assets as essential to our societies and absolutely sort of defensive and having really kind of long-running demand drivers behind them. That sort of growth, we see it in every day, part of our lives. That is part of our -- the way we engage with our families and friends, economies, our health care assets. And it's driven this exponential growth in usage of these assets over the last 5 years. The question is, when you look at smartphone penetration, you look at global Internet penetration, how many smartphones can you really have? How many [ tweaks ] is one [ tweak ] too many. And so is this a yesterday's news type story? Yes, there's growth to come, but is it slowing? I think our argument is no, it's not. The revolution here really is continuing. And if we just take a brief trip on the hype train for a second, this is really the year that I think AI obviously captured the public consciousness and took hold. I mean look at ChatGPT and then GPT-4 that has just been released, you're seeing these amazing -- for the first time, people sort of contemplating amazing use cases for this. You're also seeing AI Search is about 10x as energy- and compute-intensive as a traditional Google search. There was a paper published, I think just today or yesterday by some Microsoft engineers who've been integrating that technology into being saying they believe, in their words, GPT-4 is showing the first sparks of generalized intelligence. That is beyond a specific use case to solve general, not well-defined problems, which is both exciting and terrifying potentially. So you really see that growth and a huge impact that's going to have on our societies going forward. In a more pragmatic dirt on your fingernails-type way, there's also this robotics and automation trend that we've seen. You can sort of see the enormous uplift as people start installing both sensors and actuators at the edge of the digital networks to do the physical work that needs to be done. And then casting our mind one step further over the horizon. Quantum computing, it's still some time away, but the Google CEO recently said 5 to 10 years, this is going to transform the way we think about encryption. Problems like the traveling salesman problem, how do I orientate my fleet and reorganize port and shipping, actually solvable and optimizable. And things like biology and protein folding, I think penicillin, for instance, has 10 to the 86 possible permutations of its atoms. So actually to sort of start thinking about, well, how do we crack some of those biological problems? They're just impossible under current computing constructs. But under those quantum computing constructs, actually, these are now solvable problems. So you can kind of see that next generation of technology and the impact it's going to have. I was talking with my 9- and 6-year old in the car the other day. And I said, "Well, guys, Mr. Musk want to come and put a neural lace into your brain. How do you feel about that?" And my wife said, "That's terrible parenting." And she's right. But if you think -- if you do -- what was once a science fiction is now reality. And we only need to cast [indiscernible] forward a little bit to see. This really is the dawn of an exciting and sometimes scary new world. So bringing that back to Infratil's business and what opportunities that actually cast up in that infrastructure that powers these -- the edge of sort of these use cases. You think about -- there's actually evolving needs on the architecture and the business models of the infrastructure assets sits behind this, not just bigger, i.e. more bandwidth, but more scalable, flexible, the ability to ramp up and down, uses latency concerns. Am I close to the edge? Security and sovereignty are increasingly important, and we're seeing a lot of those U.S. regulators talk about this and how important that is becoming in their concept of how they choose not just the assets they operate on, but how they choose the capital that is behind those assets. Stability of the system and the power source of the system. These data centers and networks are predicted to take up collectively more than 5% of energy demand or more by 2030. So you think about that, that's really important to how we think about how we structure these assets. I've sort of come up with this scheme of bigger, faster, better just to get everyone very excited. Bigger, of course, the need for bandwidth originally driven by video, but then potentially by AR/VR, the compute resources net of AI faster that is closer to the edge. And it can also mean beyond some of those real latency use cases like autonomous vehicles, which we've been promised every year since 2014, I think, you can even think about that faster as being the regional edge or the metro edge that is moving out from the major data center hubs to slightly closer to the customer where land is cheaper and also hyperscalers still need to deploy content close to the customer to improve customer experience. And then better as a catchall for that bucket of opportunity, which is around sovereignty matters, security matters, flexibility matters. We're seeing this in some investment opportunities we're looking at currently around can I use software-defined networks to give you a security promise as a customer or a certainty of supply or the ability to ramp up my performance on the network but then not pay for it when I don't know when I'm going to need it. That's all been banging the sort of ra ra drum on -- this is a really high-growth exciting sector, and it is. There's, of course, risk in this space. And without sort of laboring a lot of these points, there's operational risk here. I think a good analogy I heard recently is data used to be oil. We used to store it, and the more that I could bring the better. And it sort of changed to uranium, still valuable. But if I don't store that carefully, if I don't protect that, then I am exposed. If you think about technology, there's, of course, disruption risk. And we always try and -- when we're thinking about the digital assets that Infratil invests in, we think about can we get an incumbent position where we have the privilege, right, to roll out that next generation of technology. We don't -- we're not going to have someone small come in and disrupt us. We can actually deploy that technology ourselves. And finally, sort of regulation politics. With the increasing of geopolitical tension we're seeing, this is of increasing importance to governments. They recognize us well how fundamentally these assets are of every piece of their societies and the need to really control who owns them and how they're operated. So that brings me to Infratil itself. How do we think about the opportunities, the classes of opportunities which we're going to face looking forward and then some examples of those. I don't want to sort of labor the point here on these too much. There's -- the first one there is follow-on capital. I think it goes to what Jason spoke to right at the start of the day, talking about we've invested in assets and platforms that have organic growth within them. And so that is -- we have that opportunity to deploy capital within those platforms, leveraging the expertise and the sort of natural incumbency advantages they have. There's a range of -- and there's also sort of a range of new development models as well there. And you can kind of think about those as rolling out fiber to the premise or fiber to the basement, if it's in a commercial setting, dark fiber rollouts, tower 5G builds, there's a lot of opportunities there that are on that edge of deploying capital into development spaces. There's also a range of these others here. I won't sort of read through them all, but we can really think about them as those opportunities that are within our encumbered assets and then also some of these opportunities that have been driven as the technology evolves, be it small cell, IoT networks, satellite communication hubs. We've looked at some assets as well in this space where local communication needs are important. And so we can actually -- if you can get a privileged piece of the value chain that communicates, you can really get a very defensive position. Further afield, you can really think about data itself as an asset. Are they from regulated data monopolies where you say, well, that data is defensive and the role is defensive inherently because of its monopolistic characteristic, up to, okay, businesses that have high network effects in their data set, have really high unique and hard-to-disrupt positions where you think it's going to have unique explanatory power in the long term. And often, those type of assets are linked to sort of a physical asset, a linked software and hardware asset or a linked software and sensor asset, that means that it's very hard to break that connection. My final sort of point here is just around Infratil itself. As we see, these assets are becoming a bit more important and more critical and under increasing regulatory demands to be owned by the right people. And Infratil was therefore quite privileged in its position where it sits. Sources of its capital, it's long term. So really being able to see through short-term fluctuations to long-term value, which really helps us in a lot of these positions we're building at scale. Often the nature of digital assets means they have a network effect in them. That is the bigger your position, the more privileged your position and more defensive your position is. And so that ability to deploy at scale really helps us to access some of the more attractive opportunities. And I think the third one they're trusted is of increasing importance. That is -- New Zealand is a Five Eyes' member. And it's a very -- and I think will be increasingly so, a very important piece of our value proposition to the owners of these business and these opportunities that we come from a capital source that really can be trusted to act in the long-term interests of the governments that are regulating this space. I might wind up a little early there, give you some time back. I presume Flesh, you didn't want to do questions or...

Again, it's always interesting in the longer -- lowest talks. Either they're more excited or the more scared you get. So maybe we've been lucky enough to hear quite a bit likely a couple of other conferences. So maybe there is 1 or 2 quick questions we can do. Otherwise, I'm conscious that [indiscernible] is standing at the back, need to get on a flight at sometime soon. So we'll get him on. But if there is any particular burning questions for Lewis, now you skip them.

Okay. That's all right. No problem. Thank you all and sort of handing over to Greg now.

Well, hello, everybody. Can you hear me okay? I feel like [indiscernible] up here. Hopefully, I don't look like her, although she's pretty fit. So that would be all right. It's always nice to be amongst our friends, and I'd like to acknowledge and welcome all the people that took particular effort to come and visit us in Sydney last year. I think I really enjoyed it, and I think it was great for everybody to see rubber hitting the road and what data centers do and what they put together and how therefore important they are. All the stuff and thank you for the introduction, Lewis, that all of the stuff Lewis talked about, technology, technology floating around, it's all around us, but eventually, it hits the ground and wear the ground. And that's kind of how to think about things. I would also like to thank JP. Thank you, JP, for hosting us here today. And go the worries, except when they're flying, the ride, is, of course. So hopefully, everyone here today will find this incredibly boring. And there'll be no surprises is kind of how I'm sort of thinking about it because that's kind of how we're thinking about the business. It continues to perform. And we've got a lot of tailwinds and like to talk to -- talk through everyone about that but also I would like to introduce a new concept at the Infratil Investor Day, and this is a little bit off-piste So go for the best question a bit off-piste. It's French. So when the best question today gets a really, really nice bottle of wine that Jason will buy. Okay. So I look forward to those questions. So previous performance does not indicate future performance. And so if we go into the agenda and we talk about performance then, there's probably 1 or 2 -- who here doesn't know what CDC is or hasn't seen CDC or hasn't been bored to death by me previously? There's 1 or 2, 1 or 2. So this is what we do. This is who we are. Australia and New Zealand's leading data center -- digital infrastructure data center operator. And we sort of differentiate ourselves in a number of ways around security primarily. We are very, very lucky. I didn't realize it at the time, but you sort of weave it into people's thinking. So you appear smarter than you actually are. That we started in Canberra, we started servicing government, defense, intelligence agencies, things like that, variety of our clients from day 1. And then -- so we thought what we were doing was normal, and that was the baseline. And then suddenly, as you work through the various layers of less classified organizations, enterprise and then into the cloud world, you realize what we were doing was incredibly special. And because the direction of the prevailing political and geopolitical breeze and cyber challenges and all of these things off the back of a horrible COVID period, which survived mainly due -- we all survived mainly due to technology. And as a result of all of that, the whole world has shifted even further towards us and away from traditional approaches to security and the security of data. And as a result of that, we're just incredibly well positioned. And it's impossible to retrofit a security mindset into your DNA, let alone your infrastructure. But once you've got it, you've kind of got it. The other thing is, in terms of flexibility and optionality, Lewis spoke a little bit about that. But it's actually a real thing. These buildings, the bits have really historically really boring, less than dynamic pieces of real estate that have to adapt and accommodate changing technology, which is happening constantly. And if you talk to any of the ICT hardware infrastructure manufacturers, none of their CEOs can tell you what the footprint design possibilities of next year's infrastructure is going to look like. So you have to have this inherently built in to the facilities to be flexible enough to accommodate changing technology over time. And all of the AI stuff that we kind of talked a little bit about, like there's always half cycles and people get excited ahead of the curve. But what I'm seeing is that the compute requirements are massively different. We're talking different types of chipsets, different types of cooling architectures, different densities most importantly. So all of those things mean that not many of the existing standard data center architectures that exist today will be able to comfortably or easily or cost effectively accommodate those types of offerings, whereas they will seamlessly slot into, in many instances, into existing contractual arrangements, contracted footprints with our clients. And that is a huge advantage. And that technical optionality is wonderful. And where did that come from? That comes from the fact that I'm an IT guy, not a data center guy, who's historically hated data center people because data center people tell you what you can't do. And so we've just designed our data centers and continued to design our data centers with an IT down view of the world and future-proof in mind rather than an infrastructure up view of the world, which just means we're going to be more relevant and more valuable for longer. Mission criticality, 100% availability, like that's a minimum. And we're actually in a pretty -- it's a pretty tough gig because clients expect 100% availability, 100% uptime. And you don't get rewarded for that. That's a minimum expectation. But as soon as you go 0.1% less than that, you get whacked with the most enormous stick you've ever seen. And I'll tell you what, it's not fun. So you just don't get -- want to get hit by that. So 100% of availability is what we offer. And we do that and we deliver that, and we have delivered that consistently for nearly 17 years because of the unique designs but also the standard operating procedures and different things that we do. Sustainability, you can't have -- you can't be in this industry without that being front and center of all the decisions you make. We're probably not great at sort of capturing and communicating all of our wins in this space. But 76% of our data center portfolio today is powered by 100% renewable energy. And there's not many data centers, if any, operators of our scale on the planet that can claim that. We don't use any water. No data center operator on the planet can claim that. And so -- and that's multifaceted in its benefits. But certainly resilience and the ability to continue to operate without water being available is huge. And that's one of the things we do. And we're moving to a zero waste and some of our largest data centers like Sydney, for example, have already achieved a zero waste certification. And so we will, over time, push that harder and harder. And we're very close to having a runway to being net zero. We've stated 2030, although we think we can get there earlier with a lot of the work that we're doing at the moment. Because I do envisage there'll be a date in the not-too-distant future, where a prerequisite on any sort of business, government tender or cloud arrangement will be, are you powered by 100% renewable energy and what are all of your ESG metrics. And it won't be a pie in the sky, people greenwashing, all these things. It will be certified metrics, just like official accounting standards, which are becoming more and more prevalent around the world, which is awesome. And finally, we have -- we don't try and defeat all things or people. We have a really, really narrow focus, which is government, the public sector, the biggest technology platform providers on the planet, which service the most critical customers in the world; and also the critical customers in the world who, if they were not online and available, would have a similar impact if government was off-line, so utilities, transport, financial industry, those types of organizations. That's all we do. And the nice thing about that, as a result, as we sit here today, 99% of our clients, our counterparties, are AAA credit-rated organizations. Now that's amazing. And we've just raised some money in America on the USPP thing, and that's an experience. Getting grilled for 8 hours a day on every possible thing that could possibly go wrong with your business makes this look like circus affair. It was -- and they couldn't believe that metric and also the fact that over time, our weighted average lease expiry has actually increased to nearly 14 years and then way beyond 2 decades in terms of options. And we all know, if we do a good job and with the flexibility, the optionality of our facilities, those clients will be with us for a long period of time because of the unique nature and value proposition that CDC has. So last time we spoke, this is what I said we were going to do, and this is what we've done. And so what is it? The -- what date is it? The '24. So we're very close to the famous end of the financial year. And what we can say is all of the things that we promised we're on track. We have contracted, which is fantastic, a large number of national critical infrastructure-type organization, banks and the like. So that's diversifying more of our client base than ever before. We have invested in our people. We've grown the number of people, but we're also in a really constrained resource world. We've established the CDC Academy. So we're actually training people and investing more in career pathways and career development as we tick over 200 staff now. And it is really unique skill sets in our business, highly trained, electrical, mechanical, networking sort of skills with security clearances, with the right citizenship arrangements. And that's both in Australia and New Zealand. These -- we commit to these types of additional protection for our clients, and it really pays -- has been paying off well. And as a result, our retention has improved remarkably. And we're in a good shape from a people perspective, which is really important. We have built facilities in Auckland and in 2 locations, which are now live. And you can't underestimate the achievement. That's in new geography, new building, sort of regulations, particularly around seismic and other things, a huge learning experience for us. Different consenting laws and all of those things, plus we did it during COVID, plus we did it during lockdowns, plus we did it with supply chain-constrained environment. But we hit all of our -- both cost and also time objectives. In addition to that, we've also brought new facilities on in Sydney and Canberra, and we've got some great stories about what we're going to do in the future later today. And I guess from an investor's perspective, that sort of 30% year-on-year sort of growth, we will hit those numbers this year, which is excellent. And again, hopefully, this is boring for everyone because it is as promised. So I'm glad most people here weren't at the opening of our New Zealand data center because I absolutely butchered Maori language. And -- but the local elder that was there gave me a big nod and pat me on the shoulder and I almost fell over when he did it. And he said, "My -- you're hopeless, but full respect for having to go." So that was good. So we're up and running in Silverdale and Hobsonville, great facilities, 10-megawatt IT loads, and there's a lot more to come in that space as well. And Eastern Creek, that is -- when I look back at my time with the business, we -- I think the big -- and it was a big thing like -- and really, we did it at -- almost on the back of a coaster talking on the back of a bus on a board trip to the U.S. to look at technology, should we buy this site in Sydney. And it's -- and it will -- time will probably prove that the investment and the purchase of that very small data center on a very large block of land in the western suburbs of Sydney was probably equally, if not more important, than starting the business in the first instance. Like it's huge. We've spent $1.5 billion. We have multiples of that in contracts. We will spend another $1 billion building out the remaining capacity on that site. And we're very, very excited about what that means. And that would be one of the biggest and best and certainly most secure and most impressive data center campuses in the world. And if anyone, which you have done, has had the opportunity to go there, I would challenge you to argue with any of those statements. And we had a terrific combination, both sides of politics, state and federal. And the -- it was quite interesting. I felt like it was a rose Greg day, which shows the wonderful sort of trust and relationships we do have with all levels of government in Australia. So what are we up to in terms of development? So you can see Silverdale and Hobsonville. They were too small when they opened, which is amazing. So we're adding 6 megawatts of capacity on to both locations, which predominantly is contracted. And so that's the next thing we're going to do over the course of the next 12 months. We've also purchased additional land in both locations and significant land holdings just to provide us with a runway for future growth. But I've been completely amazed at the reception we've received in New Zealand from a broad range. From commercial organizations, from government, from certainly the cloud providers, everyone is really leaning in. This country has experienced a lack of investment in infrastructure, digital infrastructure for so many years, and we're like a breadth of fresh air, and we're happy to help people breathe. And so that's in Auckland, continuing to go. And I'll tell you what, we've also lucky enough, I sound like a bit of a goose, but last night, when I was speaking with the Prime Minister, I did sort of make the sort of association with the fact you've only been here for 8 weeks, and we've had floods affect our data centers, we've had storms, we've had earthquake, we've had cyclone. Like we've fully road tested all of the design features of our facilities, and they've come through in perfect shape. And so we're very confident that although it can be a tough place to operate infrastructure, New Zealand because of the weather conditions, that we're in really good shape. So that's great. Eastern Creek, the flagship site in Australia, EC 5 and 6, 2 50-megawatt data centers. We're pretty confident that we will be building those pretty soon. They're under design at the moment. They're all approved and we're just working through the business case to kick those off. But certainly, the demand is there. We're starting a whole brand new campus in Canberra. So Fyshwick 3 will be the first data center on the new campus. And that's just, again, 17 years of continual construction in Canberra. And that goes to a new data center in Hume as well, Hume 6, on the other end of Canberra. But very, very exciting. We're sort of getting into AFL country, which is -- it's a sport they play in Australia and in Melbourne with a huge campus down there with the first building being a 20-megawatt data center, which hopefully, if things go smoothly, we might have up and running in this calendar year, but there's a lot of things to get through before now. So huge development pipeline, and we have a lot of confidence around that. And to give you an idea of what the acceleration has been, this chart shows the acceleration, which is remarkable. And so 2016 or so, we started with Infratil, and you can see where we're at. And I do -- I will note sort of because I felt a bit weird when Paul was speaking, he used the royal we, when we built 80% of CDC. So I felt like it's been nice with my feet up on the desk for the last 7 years or so, but thank you, thank you. It was excellent. But you can see the acceleration in growth and [indiscernible] defense and obviously, with Infratil's wonderful support just having that like that ability to share a vision and to put your money where your mouth is with regards to backing the management team, very impressive. And when people say to me in other settings, what would you recommend around business and whatnot? It's get some bloody good shareholders that are aligned with exactly how the business operates. Everything we do is long. It takes a long time to convince clients to move into your data center. Contracts are long. Sales cycles are long. Development takes a long time. Everything is long. So you've got to have shareholders which share that sort of perspective, and Jason and Infratil certainly do. But you can sort of see acceleration, 268 megawatts. We've got another 40-odd coming online. We've probably got another 150 to do in the not-too-distant future. So you can kind of see we're kind of trending towards doubling the size of our business in the next few years, which is no mean feat when you think about building a data center is like building a hospital. And we all know how difficult that is from reading the news. ESG, just to sort of give you a sense of it, we sort of touched on it earlier. But this -- I won't read everything out, but the key things, no water. 76% of our facilities today are renewable energy-powered. We're going through energy procurement activities at the moment to lock in and to mop up the rest of that. New Zealand, absolutely a standout. And the beautiful thing about coming to a country that respects sustainability as much as New Zealand does in starting as a greenfield is that we didn't have to do with any legacy. And so from day 1, the only data center operator in the world, CDC NZ is 100% powered by renewable energy, and that's amazing. And so the team is doing a terrific job here locally. And we do really -- it's easy to say and hard to do, but we really do care about our community. We do invest back into our community on a massive scale. And we also encourage all of our staff to invest and to volunteer and do all of those things. And it's not -- we were doing this before I ever heard of ESG, but it's a good thing to do, and happy to talk in much detail. There's obviously multiple layers to this, and it's getting more sophisticated, and luckily, more verifiable than ever before as we sit here today. So that the outlook, what we're seeing is that -- we -- our customers are just the best customers because they continue to grow. They continue to be relevant. They continue to service governments. Governments aren't going anywhere. You don't have a choice where you pay tax. So we're very happy with the mix of customers, and they continue to grow and they continue to evolve into different technologies like we're talking about AI. But we've also got customers that we're talking to around their investments in quantum. And hopefully, it won't be too long, where I'll be able to tell people that we're at the home of the one of the first quantum computers that's in production kind of state. And the magic about that and a lot of people just to ruin someone's question, is that Quantum is an additional layer to our offering. It is different to classical compute. It won't replace classical compute, it will be an adjacency. And that's the lovely thing about our business. Things just -- new technologies just keep layering up on top of this amazing foundation. An amazing foundation is just the data. And so Lewis was talking about oil, and I was just thinking about it at the back and it is true, like data used to be. You used to collect it and hold on to it, but you didn't really do much with it. But -- and nuclear submarines are big news at the moment around the world, which perversely is good for data and good for organizations that have such organizations as clients. But a tiny like a teaspoon of uranium can power a nuclear submarine almost indefinitely. Just think about that and how quickly gas is burned so oil is burnt. And so the way I think about it, and we've only -- haven't even scratched the surface is what can that data be used for? And what additional applications can that be applied to? And I think it is like uranium in that it's almost unimaginable what the future holds. But what it does mean is more data, more compute and all of those things. So the organizations like ourselves that have scale and can continue to invest will continue to ride this amazing tsunami of technological progression that we're all the beneficiaries of and the wonderful quality of life that we enjoy as a result. Sovereignty, speaking to the Prime Minister yesterday. He is so excited about all of this infrastructure coming to New Zealand. But it's no different. Our biggest customers in the world, they're saying to us that there's 30 countries that want sovereignty that we're not in today. So you can see there's so many increasingly global opportunities in this space and the sovereignty element, the really high security approach to securing the most important data and the most critical systems. There is not many people that have the experience that we do and that we've grown up with that natively. And so we're really well positioned going forward to serve these uncertain geopolitical times, and I think we're in great shape. And again, sustainability. We'll be working really hard on that. But we've got great stories already, and we'll continue to foster that and you'll hear more and more about that as we go from being Australia and New Zealand's best kept secret to something a little bit more -- still not -- we're still not going to be ONE.NZ in terms of that sort of mind penetration, but we'll be getting there. So the customers -- so this is what we're doing in the next 12 months, and I'll come back and report on this. It's pretty boring, actually. It's more of the same, but faster. And in a rising tide, everyone's going well, your job is easy because like everyone loves data centers, everyone wants data centers, everyone wants to finance data centers and all that stuff. But I challenge anyone to try it. It's not that easy. And the competition is great because it makes you fitter and stronger and all those things. But -- in a rising tide, all boats float higher. No doubt, all boats float higher, which is great. It's great for the comparative valuations and all of those things. However, some boats have bigger spinnakers than others. And we've got a really big spinnaker, which is based on not fluff, it's really a lot of substance and a lot of referenceability around what it goes into the size of our spinnaker. And we are getting more market share than our competitors, and we don't see any pause in the growth story. And so hope to surprise everyone but it's a very boring story, but it's nice and solid and reliable. And we're talking about people about infrastructure. And I remember, because data centers used to be dodgy, risky real estate investments. Real estate investment trusts and all of these constructs. But I can't think of anything more core in terms of infrastructure than data centers in digital infrastructure today. You have a pandemic, the country locks down. No one needs an airport, sorry, airport people. But I'll tell you what they need their data centers -- they need their data centers, they need their telco networks, all of those things. So if you think what's really important when push comes to shove and people laugh because it's true, but people laugh because it's not so long ago that if you said a statement like that, people think you're narcissistic megalomaniac. So it's true. So we'll continue to grow, hopefully, at the same rate, which we plan to. The finance situation, we're so well positioned with the various capital arrangements we have at our disposal from multiple jurisdictions, more capacity than we actually need currently. So we're in good shape. So that's not going to hold us back. We've got a wonderfully supportive group of shareholders that are along for the ride. We've got an incredible approach to development. And again, this is so important to understand that we -- it is -- the development world and construction world has gotten really hard. Everything costs 30%, 40% more for most people because most people really hands off. We give -- we'll let the general contractor or some Tier 1 construction firm build all that, and they just do it all. And then we pay the bills and argue over variations. We don't do that. And that's why our cost of construction haven't gone up 30%, 40% because all day, every day, we've got the boots on, the helmets on, we're in the trenches, making sure our developments are the highest quality. We're sharing risk with our construction partners. And so we're not paying 30%, 40% risk premiums, and we intimately understand what's happening on our sites each and every day. And as a result of that, we're faster, higher quality and we deliver on a per unit basis cheaper than any competitor which is remarkable. And Max is here today, who runs all of our developments, and he's done an outstanding job. And we are here every day. Our competitors, some of our customers are struggling with this whole development challenge and the cost increases and resourcing issues. We see that, but we don't experience it, because of our approach. And that's really key because the thing that's going to stop you from invoicing your next 100 megawatts of data center capacity is building 100 megawatts of data center capacity, which is good. So all in all, it's gone pretty well. We've got a lot of capacity under construction. So you can see the extensions in Auckland, 6 megawatts in both locations. The new data center, 20-odd megawatts in Melbourne, and we've started the design. Design -- so that's not included. But you can see on the far right there, the big empty multiple football field size hole, which is all flat and ready to go. That's more like 100 megawatts of data centers that we're pretty keen to build as soon as possible. So plenty of happening. We'll be busy. And you can kind of see the trajectory and my hope and aspiration is to maintain that for the foreseeable future. And you can see operationally, people wise, all of those things, they're the focus of what we're going to go for. So I just put that back and so people can have one last soak it in and then we'll go to questions. So remember, Jason, I'm thinking something nice, Jason, what would you suggest? French. French. Okay. [indiscernible] I would have thought some sort of a [indiscernible].

So we've got to questions.

How do you protect the secret source? And are there others out there who are up in the game and maybe not getting close yet, but on the trajectory?

It's really hard because our secret source was developed through extreme suffering in poverty at the start of the journey and also from the fact that we came from a different space. And so it's kind of being built in naturally into the DNA, and I've passed that along to the management team today, and we live and breathe that every day. Every dollar is your dollar, are you going to spend it or not? And whereas the bigger organizations, they kind of just work off a global kind of design and global approach, which is great when everything is smooth and supply chains happen just in time and all of those things. But if there's any disruption or any sort of left field challenge like the ground conditions are different or whatnot, then suddenly, that falls apart. And you can't build these facilities over teams. And that's kind of like the global view. You got to be in and amongst it. And we do, do things. We don't have all of our designs don't go to one general contractor. They have the civil and the base building design, but then we separately subcontract all the subsystems. So no one actually sees end-to-end, all of our -- how it all fits together. And so -- and because we come from a security background, we're really tight with our information security around and nobody gets access to that doesn't have to see it. So we're -- and the best -- they say that the best entrepreneurs are incredibly paranoid and because someone's going to steal their idea. And I am that paranoid, like you wouldn't believe it. So we're really focused on protecting it. And that's why we keep things very tight. That's also why we incentivize the really important people the way we do, so they're completely aligned with the shareholders and myself for the longer term. That's the leading question, by the way, you're leading.

From a development pipeline perspective, in the context of your development pipeline, how do you look at the trade-off between energy and electricity transmission losses and costs balanced towards close to customer that Louis talked about before in latency?

Yes. So the electrical delivery side of things is incredibly challenging. So it used to be that you would get -- you would say, or we need in those days, 2 or 3 or 5 megawatts of power. And the network provider would come and install it for free and a way you go. And now, and it would happen in about 3 months because that was in the days where they got a return on every dollar they put out the door and so they've put lots of dollars out of the door because it was all locked in by the regulator. Whereas today, it can take you 2 or 3 years to get the power that we need. And so what you've got to do is -- and again, this is why scale and track record is really important because a lot of people talk a big game, but not many people actually do what they say in this space. And so we've got relationships with all of the large network providers, New Zealand and Australia. And we're talking 5 years ahead of what we think we will need. We're co-investing in places. Two, ensure that the energy reticulation or the power reticulation is optimized around our sites. We're buying land years in advance before we know we'll need it, but we know kind of where land will be required. And so we're working really proactively. And if you do it proactively, then you can minimize and optimize all of the challenges that you've just alluded to.

In your discussions with the Prime Minister? Did you get any hope for the consenting process?

Well, I did actually because he made a point that he's from some area called the Hut region or Valley or something. And apparently, there's a lower and upper one. And if you are on either side, like 50 meters apart, it's a completely different process. And he said, like that's madness. And in a country of 5 million people and about 10 billion sheep, I think it's really important that you actually look for efficiencies. And he talked about efficiencies all day, all night last night about we've got to remove all these inefficiencies in our systems, and it wasn't just around consenting but that was kind -- and he's absolutely right, like little pockets of areas in New Zealand doing things differently. It's the same like there's only 25 million people. I'm about to take my sons to play cricket in Delhi, and there's 30 million people there, like in one city. And so -- and they do things in a certain way for 30 million people. So why can't we do it here in a consistent way for everybody. And so I actually had like high hopes because I really enjoyed everything. Most of the things that you said.

This is not winning any bottles. I can tell you that. So you had a...

He's already drunk all the French [indiscernible].

You had -- you put something up on your slide before the last one, which said explore additional strategic growth opportunities aligned to CDC's core offering? What does that mean?

Yes. So if you look at -- it couldn't be anything really. Hopefully, it makes me look really smart and thoughtful. No, no. What that kind of means is that when you have the momentum and the horsepower and the customer base that we have, more opportunities seem to emerge, whether that's in different geographies, whether that's with regards to development support, development help in different places or indeed adjacencies. And what I mean adjacencies, we have sold power and cooling for a long time, but there is -- most of the data centers that we compete with maybe some of them, maybe that's 50%, 60%, 70% of their revenue but it's not 100%. And the difference is made up through networking and different services and things like that. And so that's the exciting bit for us, is that to date, I think 1% of our revenue is around networking and other things. And we're really -- just because we've been so busy building buildings and keeping eye on things that we haven't really explored a lot of those adjacent strategic opportunities. Having said that, again, other jurisdictions, other in Australia, New Zealand and elsewhere, are on our radar all of the time. But we're 100% focused on our core business, which is what we've discussed today. But if something was to come along that was too good to say no to, well, you'd be mad not to in a world that's becoming increasingly globalized.

That was a good question.

Do you think so?

Greg, I suppose we've seen, like a lot of the hyperscalers report cloud revenue growth, which has been declining the most recent results. So that's probably like a lagging indicator. So I suppose it's interesting in your views on the leading indicator, which I suppose is the reservation queues for the hyperscalers on some of your data centers. Kind of what's happening with that?

Yes. I like you, I'm seeing you're amazed at sort of the nervousness in the world around the big technology providers with the amount of layoffs there are and all of those things. Because when you actually look at the end state financial results, they're pretty amazing, and you sort of think, well, what's really going on here. All I can see is what people are talking to me about, and they're not talking to me like things are slowing down. If anything, with new technology coming over, that doesn't mean the old technology goes away. This is additional requirements. If anything, there seems to be more in the pipeline and more opportunity coming through the industry than less. And I think things will ebb and flow over time, and I think we might be for some of the operators. But I think those -- some of the sort of the cloud revenues, perhaps what you're describing is some of the more consumer-facing organizations rather than the big beefy hard core, 100% reliable organizations that deal with government and deal with critical services for business and other things. And so perhaps some of the consumer-based organizations are struggling more because the cost of living and things impacts on consumers acutely. But that's not what I'm seeing in terms of pipeline and future growth opportunities. I'm thinking how do we gear up even more to move faster? That's kind of what I'm thinking. Yes. And then the contract, like the weighted average lease expiry, which is counterintuitive continues to grow, which is remarkable.

Okay. One more question at this point.

I haven't got an inflation question.

Don't do it.

I've been preparing for 2 weeks.

Did I hear you right when you said that 10 nations had approached you for a sovereign offering? And how does that actually work. What do you bring to the fact that...

No, no, no. What I said was the reason New Zealand is exploding is that New Zealand demanded, not demanded but requested, sovereign capability and then they change regulations around banking and other things so that the data had to be onshore, which meant that to service that data, capability had to be onshore. And it's one of the reasons we're here and the business is going for gold. But that notion in a post-pandemic world where when push comes to shove everyone is on their own, a lot of nations have picked that up. And some of our largest, which is exactly what I said, some of the largest global customers have requested from more than 30 countries around the world that are also requesting like New Zealand, a sovereign onshore compute capability for their country so that they're not dependent on information supply chains, which could be disrupted in some end of day scenario.

I'm going to sneak a second entry in. The 200 people that you've got, always interested in people. Can you double -- I think you said you're going to double your capacity to 500 in the next few years based on what you've got on the runway?

Double the capacity?

Yes. What happens to the 200 people? Can you do it with that?

We slog them to each of their lives. No, no, no. Operational leverage is a wonderful thing. You can double the size of your data center business, but it's crazy like the revenue per unit per person type of metrics because we have machines that do all the work. So you don't actually need tons more people to double the size of your business. We might go to 280, not 400 or 450 to double the size of the business in terms of capacity or revenue, which is why it's an infrastructure-like asset. So do we have a win or what do you recon Jas. It is. I really like this bloke. Actually, I'm going to give it to the first question because you're about like this. Most people are nervous and nervous to ask the first question. The gentleman with a remarkably nice hair. Thank you.

Thank you, Greg. Always informative and always entertaining. But -- so now we're moving on to actually our last presenter who is taking instruction at the moment. It's our host actually. So I'd like to ask Mr. Jason Paris to come forward and talk about his new name, his new business. So welcome.

So welcome to Vodafone New Zealand, soon to be ONE New Zealand. I think I've said this before, but it's important for me to repeat it every time. I am your personal account manager for you, for your family, for your friends. I think I've given out my e-mail address every single time, [email protected]. You can now use [email protected]. The best way for me and for the team to understand what is happening in our organization, good and bad is to hear it firsthand. And so genuinely, that's an offer to be your personal account manager. I offer that to everyone. So don't think you're especially special. Although I did say earlier today on social media that the people in this room helped bring and enable Vodafone to come back to New Zealand and focus 100% on Aotearoa and some of the results that I'm going to talk you through today are reflective of that ability. So on behalf of our customers, thank you for supporting Infratil and therefore supporting us. I do see in my e-mail out a few times a year to our entire customer base. And most recently, it was about why New Zealand change where said that I was the incoming CEO of One New Zealand. And my favorite response was from Margaret, who said congratulations on your new role. Thank God, I've got a new CEO because the last one bloody useless. So Margaret and I are now on speaking terms versus e-mail terms. She is a very loyal customer still. And when we had the conversation about all the things I'm talking to you about today that we have achieved. I think she is a customer for life. This is our pretty boring plan on a page. So the name is changing, but the strategy isn't. That's because the strategy is anchored in being the best at what our customers value the most. It's that simple. And a lot of the themes that you'll hear from me are similar themes to what you've heard from Greg. We are benefiting from significant demand for our products, for our networks and for the applications that run on them. So our customers want us to make sure that we provide the most secure, the most resilient network infrastructure. So Greg is building the data centers. We build the pipes to the hyperscalers. And we have a relationship now with every single hyperscaler where we are providing that pipe. Now it's up to us to make sure it's secure. It's resilient. And so that not just that data, but the applications that, that data enables are running on the most secure and resilient network. There's a lot of technology choices out there. People get confused. It doesn't matter how sophisticated you are or what segment you are, there are lots of choices. And so having a partner like One New Zealand that simplifies those choices down by aggregating the best from around the world are making it easy for you to run your business or to run your life, is another strategic advantage for us. And then when you do need some advice, whether it's about the next $3,500 handset or how you migrate from your antiquated private cloud infrastructure to public cloud, then it's our job to be there to help you when you need it the most. And if we do those things, we provide brilliant connectivity and resilience if we make sure that it's really simple to use and buy those products and then when you need advice we're here, we won. And the areas that we've been focusing on winning over the last 3 years have been in postpaid mobile and ICT and wholesale. And no surprise, when you focus on 3 things, you normally deliver those 3 things, and that's showing through in the results. So we do have one awesome business, and you've heard me talk about Nikko and ServeCo before. We have completed a very successful infrastructure transaction where we sold our passive mobile towers to 40 South, now one of our biggest partners. We held on to the competitive advantage, which is the active part of that network. And what remains is that active network but also a reputation for being a leader in providing BBS technology to this country first. 2G, 3G, 4G, IoT and increasingly, a focus on 5G and what that can enable as well, again, around that security, around resilience, around private networks. That investment means it's showing up in customer experience. We are New Zealand's independently awarded best mobile network. Under Vodafone global ownership, the computer did say no for about 5 years when we're going through a series of transactions for hoping to exit this market. With new owners who are very aligned on long-term value creation, we'll be able to invest the capital to make sure that we have upgraded our networks, especially in the regions, and we're being recognized for it. The pathway is still being accelerated. So we talked to you about our plan for upgrade in 4G and 5G. That is on track. We're on track for 3G shutdown and to reform that spectrum to deliver even better, faster experiences from a 4G and 5G perspective. And it's important to note that the value creation isn't just in mobility, it's also in our fixed assets. So those of you who keep a close eye on our industry, you'll know that there's a lot of international interest now on FiberCo type conversations and we believe there's ongoing value uplift, especially for us, given that we are the second largest owner of fixed infrastructure in New Zealand. So we are perfectly positioned to evaluate the options and infrastructure. So we're a scale infrastructure business. We're also a scale services business with over 2 million New Zealanders who trust us to provide them with mobility and over 100,000 businesses that trust us to provide a range of services. Yes, fax services, but increasingly, in all areas of ICT, whether it's security or contact center or clouds or IoT. The results that are coming through here from a scaled service provider are exceptional. And these results are not by accident. They are the result of deliberate moves that this organization has made over a period of years to create momentum. And in this organization, in this industry, momentum is hard to get, but there's also extremely hard to stop. And so we are very, very proud that we are the fastest-growing in postpaid mobile. 8 of the last 9 quarters, we are outperforming the market. We're also the fastest-growing in ICT, albeit off a slow start and a lower base. But the beauty of that is, again, we get to partner with brilliant organizations like CDC that don't have any incumbent's dilemma, that can only do the absolute best for their customers and use the hyperscalers who are much better than anyone else in New Zealand at providing the technology future. We continue to have the best IT and customer service results that we have ever had, and that basically means that our applications work and that if you need to get some help, you're waiting less time to get your call answered. And when you do get answered, you get answered by an expert who can sort your issue out first time. And we're doing that by removing complexity for the business, which is great for our customers because they have less need for service that also reduces our cost. So we are a lean mean operating machine in this organization now. And the first couple of years, you heard me talk about operational efficiency, and that was driving a lot of the gains that we were getting in the market. We've now got the perfect scenario of operational efficiency being sustained, further opportunity available and top line revenue and margin growth. So both lines are running to deliver our EBITDA and our cash results. Reflective of our owners, they invest in assets that are essential for the communities that they serve. And it's not just about the technology that we provide, it's what that technology that can enable that is also very, very important. And so we're very proud of our record around using technology and our privileged position as being one of the most important and iconic organizations in Aotearoa, that we use that technology to attempt to halve the number of disadvantaged youth in New Zealand. And at the same time, ensure that New Zealand is one of the greatest places on the planet to live and work for the next generation. And so we take our position in terms of how we impact the environment very seriously. One of the best kept secrets is the amount of money that we have invested and continue to invest into New Zealand around having a number of disadvantaged youth. And also, we've got a toy to review underway aligned with all the things that you've heard from Infratil and Morrison and what you'd hear from Brookfield around the responsibility that we have around sustainability. And I also had the privilege of talking to the Prime Minister last, last night. I have to say, you experience from Greg, I open have about 10% of the conversation here at about 90% of the conversation. But one of the things that the Prime Minister did say was how delighted he was with the industry and Vodafone's response to the devastation that we had in Auckland and in the East Coast of New Zealand. And I'm extremely proud of the way that we responded prioritizing our customers and our people, and we think we did a very, very good job. Then it all comes down to an awesome team. So you're great in a crisis, but we're now becoming not just great in a crisis, but business as usual. So the foundation of any organization is the quality and the capability of the people in it and how passionate and clear they are around where you are hitting. We use a tool in this organization called the Organizational Health Index. It's used by most large corporations around the world. It's called OHI, and we completed this piece of research about 3 years ago and then we did it 18 months ago, and we've just completed again in the last month. And we've moved from middle of the pack to the top 25% performing organizations globally and our ambition is to get into the top 10% of organizations globally. And there is just no -- there's a very clear link to our organizational health being an early indicator of future commercial performance. So the results that we're seeing in terms of the capability of this organization to execute through OHI gives us a lot of confidence, the momentum that we have achieved today is going to be very sustainable. And then I highlight around awesome team as it's not just the people that work in this organization as employees, it's also the partners. So we don't have the arrogance to think that we can build any better than CDC or develop an application better than Microsoft. All of these partners are extremely important to the future for our customers, and therefore, they are extremely important for our future. So Vodafone continues as part of One New Zealand to be an extremely important partner. All the products and services that our customers love today will remain. All we lose are the things that our customers don't. But Vodafone is just one partner along with Amazon, along with Microsoft, along with Google, along with Harvey Norman, along with CDC, along with DEFEND. All of these organizations make up the One New Zealand portfolio now. And again, another reason for the brand change. We are not just about mobility. We are about all leading technologies. And that kind of strategy and momentum and capability within the organization leads to results. And we've just added -- we've just put in a few highlights here. But again, around those themes of mobility, around ICT and around wholesale, the 3 areas which are the most profitable and that our customers love the most, we are winning in. As I mentioned before, fastest-growing and postpaid connections. But that's not just about connections, it's also about margin. So yes, roaming has come back even faster than we expected. But actually, a lot of our improvement in mobile performance has been driven through ARPU growth, through pre to post migration and through upsell. And ICT, again, the fastest growing in the market with our partnerships, with people like CDC, with our acquisition of DEFEND, with our Postures, New Zealand's leading IoT provider, with our credentials and Amazon Connect as New Zealand's leading certified partner of that contact center platform leaves us in a very, very strong position. And the enterprise team are doing a brilliant job of increasingly selling more services and creating deeper relationships with our customers. And you can see that ICT attachment rate, again, is industry-leading. And then wholesale, which are longer-term contracts, we are getting some growth now. We've built the MVNO platform, and we're starting to expand the wholesale market. We're very active in that. We want to make sure that our networks are the highest utilized in the market, not just by our own brands but by others as well. And as I mentioned before, our partnerships with hyperscale is providing that resilient, secure connectivity to the hyperscalers is in our core DNA, and we are partnering in the provider of choice to all of them. Again, setting us up for the explosion and what those use cases are and however they are, they come about through the use of data. They have to have a network to run on them, and that's where we are best positioned. So a little bit -- not as boring as Greg's and that we are going to exceed our guidance. And so we're very proud of that. The -- our guidance doesn't include any impairments or the costs of the teleco transaction. But it has been driven by 3 things. In a small way, a kind of a reclassification of IT from OpEx to CapEx. But in a big way, roaming returning and in a big way, our market-leading mobile performance. So more customers and a higher ARPU have driven that increase in market guidance. And you can see that in the 8% growth under mobility. So that's been driven not only by our performance and acquisition and then also ARPU but we have our lowest ever SME mobile churn and Vodafone's history. When I started in this industry, we were sitting at around a tune of, say, 17%. We are now less than half of that in this business. So we are doing a brilliant job of not only attracting customers to our business, but when they're here, making sure that they love us so much that they stay. From a consumer and SME fix perspective, back 11, 7 of that is due to us getting out of Vodafone TV, an unprofitable product costing us too much. It was a margin loser. We knew that by removing ourselves from that market over 100,000 customers that we would cede some customers, but we're prepared to do that because it's the right decisions from a simplicity perspective, but also from a margin perspective. And then the other 4% of that 11% is deciding not to compete in the commoditized consumer fixed broadband market. The winners in there are the energy companies who are growing at a faster rate than the incumbents because they're losing money on the acquisition. They're prepared to lose money on a broadband play to protect energy margins. That's their decision. We don't want to do that. Instead, we've got flat ARPUs, and we're prepared to cede a bit of market share to ensure that we're not putting unprofitable broadband offers in end market. Different story on enterprise, where Fixed and ICT grew by 16%. I've talked about the momentum that we've got across all of those portfolios. But again, it's not a scattergun approach. We're very deliberate in ICT and exactly where the areas are we want to play. We are partnering with the hyperscalers. We are focusing on accelerated public cloud migration with partners like DCI, like CDC, like Azure, like AWS. In security, we're very proud of the acquisition or partial acquisition of DEFEND. We own 60% of that. It's on plan. It's integrated really well. We're basically just a massive sales channel to market for DEFEND. The worst case for DEFEND is for us to do anything to change anything that's made them already successful. And so we're just a channel to market for them, and it's going extremely, extremely well. I mentioned before our partnership with Amazon Connect. We've got a fantastic track record; in fact, New Zealand's best track record and migrating our customers off legacy contact center technology onto Amazon Connect or Genesys PureCloud. And then, again, in IoT, Lindsay and her team are very, very specific around where we want to play in that space, which is around a mix of IoT connectivity and then also the aggregation of the insight and the data that they would have. We have decided we're not going to be in that device monitoring part of the IoT business. And then in wholesale, I mentioned before, 4% growth, and that will continue to grow. We're increasingly confident in our wholesale trajectory on those long-term deals. From an operating expenses perspective, about 9%, but underlying, it was flat. There are 2 one-offs in there. One is the brand and the other one is our retail store buyback. I think it's there in the notes somewhere. So we're managing to negate the high inflation that everyone is experiencing as costs coming into the business by again, running the business very profitably, and that flows through our EBITDA. And then as I mentioned, the CapEx, that's a half-on-half difference as you can see there, really on nonrecurring spectrum costs. So any more questions on that, if you want to get through it, we've got Jeremy, our CFO. But we're very, very proud to have exceeded the guidance based on trading momentum. And we're feeling really, really good about how the organization is positioned moving forward. One of the anchors of our move moving forward is going to be simplicity. It's one of the kind of 4 pillars of our strategy. And we're still focused on making sure that we are the most simple, most simplified telco within New Zealand. I've talked to you 3 or 4 times about the IT program called [ DX ]. We've pivoted, that didn't work. So there's no such thing as an off-the-shelf IT solution, especially when you try and customize it as soon as you get it. And so we've pivoted to our existing vendors. We're still as ambitious as we were around bringing forward of simplicity dividends, both from an experience and a cost perspective that's still banked into our corporate plan. But how we will realize them is with our existing vendors like Salesforce, like Oracle, so upgrading our existing IT through our existing vendors versus a big bang approach with a new vendor. As I mentioned earlier, our existing IT has never been more stable. And so the team has done actually a great job of squeezing more out of our existing IT than we thought was possible 3 years ago. And again, that's flowing through into our trading numbers. And then in business simplification, we've got our TO office, our transformation office, and now focusing on 4 things. Product rationalization, and we're already making big strides and moves there. We've migrated all of our consumer mobile customers onto a single stack. So for those of you who have heard me before, Vodafone and One is a mix of Telstra and Satin and Clear and Ihug and WorldxChange. And none of that simplification has been done. We've still got some of that complexity in the organization, but we're now moving our customers onto our best existing stack, and then we're upgrading it again with Salesforce and with Oracle. Improved digital experiences as you'll be aware. And everyone was talking about AI and robotics and automation, and we're doing that here. In fact, yesterday, I had ChatGPT, give my senior leadership team's speech on my behalf to the team. And just quietly, I think they enjoyed ChatGPT more than they enjoy my normal speeches. And then again, a big focus on simplification has never been more demonstrated by the public commitment that One is going to give to the country. So it's not just a name change. It's a business change around One click, One call, One bill, One product, One process, One meeting, One decision maker. So it's not just a business driver. It's a cultural driver, in the organization. And that's really leading to the benefits that the brand change will give us. Yes, it's going to give us a cost advantage. And that means that we're paying less money overseas to our group, and more money is staying in Aotearoa, enabling us to invest in all of those things that our customers value the most. Secondly, it will improve our mobile trading performance. You can see with the customers that we've got an existing relationship with, we are upselling them. We're getting higher ARPU. We're reducing our cost to operate. We're getting better margin. But as many of you will know, over the last 5 or 10 years, any telco has pissed off its customer at some point in time. And everyone said, I'll never consider them again. It's a funny thing, and I experienced this when we did the telecom to Spark. As soon as you say, you're a little bit different, you open up a conversation to see if you really are different. The pressure on this organization is you better be different and better bit observer when you have that conversation. And again, based on our metrics, whether it's network or service or value, we are very, very confident that we are well positioned. So there will be hundreds of thousands of Kiwis who previously were not going to consider Vodafone that will consider One, and we are going to convert them, and we are going to keep them. And then lastly, the ICT growth. Vodafone is known as a mobility leader. It's how it entered and disrupted the New Zealand market. It's a foundation that we don't want to leave behind. But as I mentioned before, Vodafone is just now one of our partners. Microsoft, Google, Amazon, DEFEND, Palo Alto, Nokia, they are all part of our partnership strategy now. All of the world's leading technology services we provide on New Zealand's leading most secure and resilient networks. And again, the One New Zealand position will open up a range of conversations that we haven't previously had with our existing customers and new customers around ICT. So I'll just finish by saying being in this industry for a long time, been in this organization for now 4.5 years, and I joined kind of at the same time as Brookfield and Infratil did. In fact, I think my first month as CEO of my first meetings was trebling overseas to meet the prospective new owners. And I remember finding out a lot about this organization and realizing that there was a lot more risk but a lot more reward than any of us anticipated. I think getting our backyard in order, first and foremost, focusing on what our customers value the most has been a winning strategy. And now we're seeing a lot more reward than risk. And in this industry, momentum, again, is hard to get but it's also hard to stop, and we're feeling hard to stop. So I'll stop and pause there, and I was -- a lot of information pretty quickly and then go to any questions, just conscious of time as well. Jason, please? Yes, we forgot. So actually, there's a -- we've got a present for all of you. So we have got a One New Zealand branded power bank. So take that away and make sure that when you or your teenagers or someone is running out of juice, you'll have One New Zealand to thank for ongoing connectivity. And then yes, it is the Warriors' year. So we have 5 Warriors jerseys to give away. I said to kind of -- it should be the people that don't ask a question. Yes, I know. We only got 5 of them. But if you are a massive Warriors' supporter or fan, then you can have a chat with them.

Joe, just looking at the numbers, I was hearing the margin was around 26%, I think. So can you give us a bit of color on when you think you will get to that 30% target, which I think was the...

I'm going to give guidance in May. All I would say is we've got momentum as we exit this financial year based on cost and also on trading. And so we're excited about our exit point. Stable market structure, extremely competitive. And we're seeing ourselves some ambitious but achievable targets that we'll talk to you about in May. But backing away from that number in that target, we're still focused on it.

And just a follow-up. So when you're doing your kind of 24 budgets, what are you assuming for the kind of economic impact, say, on the consumer? What's your assumptions around that?

Not a lot. We're not seeing it actually. So we're probably a little bit more conservative on the enterprise segment than we are in consumer. If you look at our value offerings and market across any products or our portfolio, we think we're there or thereabouts. So if you need connectivity, which is basically becoming an essential service, we're just not seeing it. We put pricing up a couple of times through the year, churn didn't move. So quite a loyal customer base. And even in enterprise, we were probably being a little bit more conservative because of the economic conditions and business confidence. We think it's temporary. And as Greg said before, and you'd hear if Lindsay was up here, the smart businesses are still making investments and focusing now on the long-term gains they can get from making those big technology moves. So we're still having those conversations around public migration, contact center replacement, the importance of security, IoT is a game changer for businesses, and those conversations haven't stopped.

Subject to the -- sorry, since the merger, are you seeing 2degrees as a better competitor in any segments?

We see the merger as market positive. So an even more competitive but stable market structure, which is excellent. We're seeing 2degrees be most aggressive in the SME segment, mainly driven through price. But as I mentioned before, lowest churn on record and SME. So the relationships and the proposition that we've got seems to be able to counter any tactical price offerings that 2degrees might attempt end market. So that's where we're seeing it most competitive in terms of offers, but not impacting our business.

I'm not sure whether this is a worthy question for the last of the day but it is a detailed question. The fiber or the hybrid fiber network in Wellington, legacy network, gradually people coming off. Can you talk to sort of what the timing and sort of cost of dismantling that might be? Or would you have an alternative use for?

Yes. We think that the DUCs are extremely valuable because they're very useful. And then you've got a range of options in Christchurch and Wellington around whether you upgrade with existing HFC technology or whether you upgrade to fiber using those same DUCs or whether you shut it down. So we've got a range of options that will be part of our FiberCo evaluation over the next kind of 12 to 18 months on how HFC plays a part and how FiberCo opportunity or not. So all options are on the table at the moment, and we haven't made a definitive decision.

And the overhead lines? That's part of the same discussion as well ?

Yes. Correct.

If we were thinking of dismantling cost, I mean, what kind of ballpark will we be talking about there?

We haven't put a number on it because it's just one of many options that we need to investigate. My personal preference is that's the least likely. I still feel like it's a strategic asset of some benefit. But again, we need to see if that's how it plays out.

Okay. We're going to call it a day here. So thank you.

You got some jerseys handing out at the time. I had a few questions. Thank you. Thanks.

Great. Well, let me give me a couple of minutes, and I'll try and wrap it up with a couple of thoughts and a few thank yous. I was standing there wondering a couple of things. One is I said at the start of the day, this is your sort of one chance of the year, right, to see the management teams we get to see almost every day. And it's hard, but not be incredibly impressed, I think, how amazing they are. And hopefully, you've got a flavor of that today. I certainly did standing here listening to them. And you should hopefully get a sense that the standard for just existing in Infratil or Morrison & Co portfolio is actually really high. And it gets higher. And you're seeing the outputs of that today, right? Is there a better renewable energy developer in Australia and New Zealand and beyond and in Clayton, like I challenge you to find a better one. Is there a better team in the North America biggest, Mike, in the world, I challenge you to find a better one, and you get to talk to them here, Greg, Jason one-on-one once a year. So hopefully, you get a flavor of that and why we feel bullish. And I should say the people who aren't on the stage today, you should get exactly the same feeling, and I bet you will. If you talk to Matt and Jenner and his team and David and his team and actually Brett who's on holiday. These are leaders in the industry with long-term visions for how their businesses will thrive under our ownership with a long-term orientation in an ever-changing world. So I felt that. I hope you did too. I talked at the start of the day about the opportunities we see to just continue to invest in the things we're already doing. And you would be missing the point to think that meant doing the same thing we did yesterday tomorrow, but maybe a little bit faster. And you should have heard today and that actually what it means is using the base of what we've got, which -- the benefits of which are not always obvious, like the flexibility Greg talks about and his data centers, which no one else in the world has to the same degree he has or the fiber footprint Jason has or the list could go on to address things that are definitely going to happen in our sectors in a way that should continue to meet the return on capital expectations that you saw in that box build up. There are many opportunities, and it's really our job to make sure the individual businesses set themselves up to address those. The other part of our job is to pick the ones that we think offer the best risk return impact. And I think one of our real advantages as Infratil is that we're not only focused on one sector. We get to compare and contrast similar but different sectors. And actually, as Morrison & Co, we're looking even broader, right? At a whole heap of things that don't fit Infratil. And so we do have really useful insight on which horse to back. And it won't be all the ones in our label all the time, as Vimal said, some things are on, some things are off. The good thing for us is we don't have to go into one of them when it's off because it's not everything we do. We can move to something else. So the management teams we have managed to work with, the long-term vision and our flexibility, I think, continues to be a source of real advantage and value creation and actually, I think, quite a unique proposition in this market. So that was my wrap up. A few thank yous. I mean thank you all for being here and being here for the afternoon as well. It's been amazing to get your questions and to see you all in person. Thank you, Jason, for hosting us. Thank you, Sharon and Matt, especially for putting all of this together and last time as well. They went amazingly well, so please give them a hand. We'll see you again -- actually, we're being up here without Philippa. Where are you? She's definitely my partner in crime. So we're never doing the scheme by the way. You're going to be up here. So -- but we will see you together again, right, in May for full year's, and we'll give you some guidance for next year. And I think we've run it over time. So I will let you go but if anybody wants to ask me any questions, I'll be over in the corner. Thank you.