IntegraFin Holdings plc ($IHP)

Good morning, everyone. Welcome to IntegraFin's interim results presentation for the 6 months ended 31st March 2026. I'm Alex Scott, Group CEO, and joining me today is our Group CFO, Euan Marshall. I'm going to kick off with an overview of the excellent results that the group has delivered over the past 6 months, highlighting our strength in platform inflows and accelerating growth in profitability. I'll then hand over to Euan to run through the group's financial performance and provide an update on the progress of the group cost and efficiency program. Finally, I'll share an update on the operational performance of the Transact platform. In particular, I'll explain how the group positions itself as an attractive proposition for all sizes of advice firms, including consolidators, and I'll discuss the opportunities for AI use, both in the IHP business and in the wider financial advice industry. Then we'll conclude with Q&A. The group has delivered a step change in profitability with impressive earnings growth in the first half of the financial year. The Transact platform demonstrated strong performance in flows and FUD, thanks to the enduring appeal of our market-leading proposition that combines proprietary technology and personal service. This strategy has helped secure the group's prominent position in the growing U.K. adviser investment platform market. Our exceptional market position is the result of our consistent, resilient business model and long-term focus. Clients, advisers and shareholders alike benefit from a stable platform that delivers reliable profitability and plans for longevity. Our results since IPO have demonstrated our capacity for growth with the implementation of key initiatives, including our cost management program and our focus on delivering technology automation, we anticipate even stronger growth in future. Half year '26 gross and net inflows were at or near record levels, with net inflows growing 14% compared to the half year '25 and average FUD up 17% to GBP 77 billion. Our platform revenue grew 11% with 99% of that coming from recurring sources. Meanwhile, efficiency and productivity enhancements from our cost management initiatives drove a moderation in administrative expense growth in line with our guidance. The reduction in the rate of underlying cost growth supports an enhanced profit margin and in time, will reduce the cost to serve the platform clients. As a result of this coordinated strategy delivery, we achieved 16% profit before tax growth for the half year period and expanded our PBT margin to 51%. We see further profit margin expansion as sustainable, thanks to the broad-based strength of our business. Our business model is highly cash generative and has delivered growing dividends. I'm pleased to announce we've raised our first interim dividend for this financial year to 3.8p per share, up 15%. Focusing on our inflows performance, this half year saw considerable strength in platform flows with gross inflows reaching a record level of over GBP 6 billion. Net inflows were GBP 2.4 billion, up 14% on the half year '25 comparative, a reflection of the ongoing quality of the Transact platform and the digital and integration enhancements we've made over recent years. Transact was in the top 3 in the adviser platform market for both gross inflows and net inflows for the period. Client numbers were up 5% over the period, reaching over 254,000. And we also improved our transfer ratio over the period -- half year -- previous half year period to 2.8 in half year '26, sitting in our strong competitive position. I'd like to highlight 3 key work streams essential to our continued growth. Data access and data quality of paramount importance, especially as use of AI tools becomes more widespread among financial advice firms. We're renewing our focus on integrations and APIs to ensure that Transact interfaces seamlessly with advice firms' chosen technology stacks. Relatedly, we are assessing ways in which we can further leverage automation and AI to reduce processing time and deliver efficiencies, both internally in support functions and operationally for our clients and advisers. We're exploring how we can use AI tools to enhance the coding capabilities of our development team to the benefit of our proprietary technology. Our third key program of work relates to delivering the cost and efficiency program announced last year. This program is progressing well, and we are already seeing moderation in cost growth in half year '26 compared to half year '25. We have seen great success with the restructuring of our support functions and the introduction of new tools to increase efficiency. Executing and delivering on these 3 key work streams will strengthen our proposition, delivering greater client numbers, strong net inflows and increased profitability. I'll now hand over to Euan for a more in-depth look at the financials for the period.

Thanks, Alex. Good morning, everyone. The first slide that I'm going to share with you this morning is an overview of our KPIs. What you will clearly see, as I talk you through these metrics, is the acceleration in the financial performance of the business coming through, which is resulting from the ongoing delivery of our strategic priorities that Alex has described. As shown in the top left graph, average daily FUD has grown 17% year-on-year to GBP 77.5 billion. Aside from market movements, this has been driven by record gross inflows of GBP 6 billion during H1, of which the main driver has been the strengthening of our net transfers as the platform continues to attract more business from our competitors. We have achieved an impressive 14% compound annual growth rate in average daily FUD since HY '23. Now looking at the top right graph, the growth in our average FUD has translated into group revenue of GBP 85.8 million for HY '26, up 11% from H1 last year. I'll discuss platform revenue, which constitutes the majority of group revenue in more detail on the next slide. The bottom left graph shows that this record revenue, combined with the slowing growth in the cost base, has driven group underlying profit before tax up 16% to GBP 43.9 million and delivered an improved underlying profit margin of 51%. Moving on to this bottom right graph. The group delivered strong growth in underlying EPS, up 14% on the prior year to 10p per share. As a result, we have increased the first interim dividend by 15% to 3.8p per share. Looking in more detail at the Transact platform revenue for HY '26, we can see investment platform revenue increased by GBP 8.5 million or 11% in comparison to the prior year to GBP 83.2 million. The majority of platform revenue is driven by annual charge income and the 17% growth in average daily FUD during the period translated into 14% growth in this revenue stream to GBP 76.4 million. As we have previously discussed, the lower increase in annual charge income is, in comparison to average FUD, is mainly as a result of clients benefiting from the natural movement through our tiered pricing structure as the value of their portfolio increases. Taking this into account, roughly 3/4 of the FUD growth drops through to annual charge income. Wrapper fee income reduced in comparison to last year, reflecting the reduction in charges for family-linked portfolios that we implemented in H2 of the previous financial year. These 2 recurring revenue streams combined to deliver 99% of total platform revenue. As a reminder, we continue not to generate revenue through retention of interest on client cash. T4A revenue increased slightly to GBP 2.6 million. Following next on the platform revenue margin. The graph highlights how revenue margins continued to moderate. The reduction of 1 basis point from the prior year comes primarily as a result of the natural progression of client portfolios through our tiered pricing structure, and the effect of the reduction in charges for family-linked portfolios that was implemented at the start of H2 last year that I described on the last slide. Given that the impact of the reduction in family-linked portfolios is included in last year's H2 revenue, we anticipate a more noticeable moderation in revenue margin as we move forward. I'll now move -- I'll now provide more detail on our H1 cost base and cost initiatives. Firstly, as an overview of our cost initiatives, we have made good progress during the first half of the year. Across our support functions and operational areas, we have been implementing efficiencies and structural changes. Our platform operations have continued to focus on increasing the level of straight-through processing and automation, resulting in a reduction in manual tasks and processing times. Both of these in combination have enabled us to remove headcount in certain functions during recent months. In parallel, we have continued to invest in our market-leading proposition and also in staff who focus on enabling the delivery of future efficiencies, including more automation. You'll see that staff costs have been the major driver of the 4% or GBP 1.7 million rise in administrative expenses in H1. But you also see in the bottom graph that headcount in the period has reduced by 16 or 3%, meaning that staff cost run rate is in a good position as we enter H2. Non-staff costs have fallen this year as a result of some rebates on property provisions, but also through rigorous review of our contracts with third-party suppliers. We remain confident in meeting the 3% or GBP 94 million administrative expense target for FY '26. Future road map efficiencies, which offset planned investments, also puts us in a good footing for achieving our cost target for FY '27. These actions have put us on a clear path to long-term sustainable growth, including reducing our cost to serve per client while creating a more focused and resilient business for the future. Next, moving on to liquidity. The liquidity buffer has not changed meaningfully since the year-end, mainly as a result of higher regulatory capital requirements in our regulated entities. We have also disclosed the liquidity held in our group company and surplus held in our group subsidiaries as it illustrates that there will always be timing differences between profit generation in our operating subsidiaries and surplus liquidity in those entities flowing up to the group company. As a result, as well as taking into account the timing lags that I've just described, we maintain a liquidity buffer to ensure we have resilience against external shocks and can continue to invest in the business while continuing to pay dividends to our shareholders. We remain confident that at this point in time, we have the right level of available liquidity to keep -- to help support the future requirements of the group. In terms of cash flow, the business continues to be highly cash generative with the majority of profit flowing through into cash. We generated an additional GBP 34 million of liquidity in HY '26 in comparison to profit after tax of GBP 33 million, giving a conversion of just over 100%. Cash conversion of around 100% is expected for the full year and on an ongoing basis. For those of you that want to understand more on corporate cash flows, a reconciliation of this figure is provided in the appendix to the presentation. The high level of profit to cash conversion allows us to continue to pay dividends on an ongoing basis. I'm pleased to say we have approved a dividend for the half year of 3.8p per share, a 15% increase on HY '25. Our dividend policy continues to be to pay out 60% to 65% of profit after tax for the year over our 2 dividends. Next, I'll talk you through the group's guidance for FY '26 and FY '27. In summary, there are no changes to our revenue and cost guidance. We're focused on managing the platform revenue margin. We expect the reduction in this metric to slow with the main driver of the reduction being clients moving through the tiered charging structure. As I highlighted on our cost slides, we remain on track to deliver total underlying administrative expenses growth at 3% per year in FY '26 and FY '27, with cost growth in H2 of this year slowing in comparison to H1. Given changes to interest rate expectations over recent months, we now expect net interest income to be a little higher than anticipated earlier in the year. We have uplifted expectations to GBP 10 million in FY '26 and GBP 11 million in FY '27. We continue to expect net gain attributable to policyholder returns to be in the region of GBP 2 million per year. Moving on to my final slide. I wanted to highlight again the 3 core levers on which we are focused in order to drive earnings growth. Firstly, we've invested significantly in the business over the last few years. We believe this investment has been fundamental to improving our prominent position in a competitive market, with market share of net inflows consistently being in excess of 20% over recent periods. This investment now puts us in a position where we can focus on margin delivery. The second and third levers focus on revenue margin and on cost management, and leave us in a position to accelerate earnings growth and enhance shareholder value in future years. You are already seeing this come through in the H1 financials through underlying PBT growth of 16% and profit margin improvement to 51%. The strategy is delivering, and we're confident in ongoing delivery moving forward. That concludes my part of the presentation. I will now hand back to Alex.

Thanks, Euan. In this next section, I'll provide an update on the group's operational performance and the key developments within the financial advice market. I'll discuss how the group has been adapting to make our proposition more appealing to advice firm consolidators. And I'll also provide some color on how we're implementing automation and AI into the group's processes and how our market-leading proposition is well placed to keep winning in an evolving advice market. We operate in an expanding market with a compelling growth opportunity. The U.K. adviser platform market grew by 13% in the past 12 months. Our market research forecasts an average annual realistic growth rate of 12% for the next 5 years. There also remains a large and growing pool of U.K. investable assets with potential to move into the platform market. Within this attractive market, Transact continues to take a strong share of net inflows. Our share of net inflows in the first half of financial year '26 was 25% of the market, reflecting the quality and competitiveness of Transact's proposition. Transact's stability and consistency is a key factor in our success. We have a 10% share of U.K. adviser platform market FUD. We continue to seek to improve our technology and service to further improve our position. A key trend in the U.K. advice market is the growth of financial firm consolidators. This is not a new trend and importantly, is one that we've been actively aligned with for some time with the broadening of our Transact proposition for large and consolidator advice firms. Therefore, Transact is already a highly attractive platform partner for consolidators and large advice firms. We continue to see strong transfer in ratios, both across the market overall and specifically from consolidators. Our net transfer ratio in ratio with consolidators is increasing as firms consolidate assets onto a smaller number of strategic platforms. Known as platform panels, many consolidators are choosing to include Transact in their selection of platforms. Central to this success is that Transact's proposition is closely aligned with consolidators' priorities. They are focused on continuing to grow assets under advice, drive efficiency through scale and managing regulatory and taxation complexity. The Transact platform allows them to do this. Our breadth of wrapper capability, including bonds and trusts, is an attractive proposition for consolidators across their asset base. At the same time, our full-service model and adviser succession service support advice firms scaling without sacrificing service quality. From an efficiency standpoint, APIs, platform rationalization and integration with CURO, and other advice firms' CRMs, allow larger firms and consolidators to standardize workflows and reduce operational friction as they grow. Critically, our in-house technology and regulatory support helps consolidators manage risk as their client bases expand. While the core proposition is already well suited to our consolidators, we're also evolving aspects of our approach to reflect the increasing scale and sophistication of these firms. That includes deeper multilayered engagement with consolidator leadership teams, more tailored services and MI for larger firms. These refinements to our business model reflect the increasing scale and sophistication of consolidators rather than change in Transact's core strategy. In short, we understand consolidation. We are already winning with these firms, and we're selectively upgrading our business model to be even more attractive to these firms in future. Another area of focus for business model enhancement is AI and automation. Integrations were already a key component of our proprietary technology strategy. Now our investment in the APIs that improve the quality and speed of integration for advice software is streamlining the implementation and adoption of external AI tools for advice firms. We're also adopting AI tools within the group's proprietary technology development process itself, particularly in back-end coding and testing. The focus here is on reducing development cycle times, improving consistency and empowering our experienced team of developers. Across group support functions, including finance, risk and HR, we're already bringing in new systems that will enable us to implement trusted AI productivity tools in core processes. This is about freeing up capacity and improving accuracy, and allowing teams to increase the efficiencies of their workflows. Stepping back, the common theme across these initiatives is efficiency and scalability. AI can enable a more attractive platform proposition, a lower marginal cost per client and a highly scalable operating model, all of which support further profit margin progression and a reducing cost to serve clients over time. We approach AI as we've approached all new technologies as a means to enhance our best-in-class service proposition, not a replacement for our core competencies. Our cost guidance already incorporates ongoing technology investment, including AI and automation. The work streams presented here are about deploying budgeted resources to improve efficiency, scalability and operational resilience. Looking at AI's possible impact on the advice market more broadly, we see it as a potential tailwind for the U.K. advice market. In particular, AI can help advice firms scale more efficiently within an increasingly complex regulatory environment. The development of AI tools can support adviser productivity. Examples include the recording and transcription of client meetings, and tools that help support suitability requirement and client reporting processes. Importantly, these tools are about assisting advisers rather than replacing them, a complement, not a substitute. This will help advisers spend more time productively with clients as well as growing their book of clients and assets while maintaining regulatory standards. Taken together, these developments support the scale growth of more efficient advice firms that are able to serve larger client bases and greater assets under advice. Overall, we see AI's impact on the financial advice market as a net positive. Harnessed correctly, it can support the long-term sustainability and growth of the U.K. advice market. In turn, this creates a supportive backdrop for continued strong asset flows on to Transact. IntegraFin's investment in AI and exploration of its possible opportunities built to top our established competitive position. The group's unique and hard-to-replicate business model is built to both withstand and benefit from ongoing technological change. The group utilizes proprietary technology, and we're well placed to benefit from AI back-end coding efficiencies. We provide a high-touch client service delivered by experienced staff, which is highly valued by both clients and advisers. We're a leading and award-winning brand with a strong reputation among the U.K. financial adviser community, and we have a deep understanding of the complex and evolving U.K. tax and regulatory regime. This combination of factors is differentiated, hard to replicate, and allows us to keep winning new business and take advantage of the new market opportunities presented by AI. So to summarize, in the half year '26, we delivered record gross and strong net inflows in a growing U.K. adviser platform market. We are confident of maintaining good net inflows momentum in future years. The group has delivered earnings growth with a 51% profit before tax margin in half year and earnings per share up 14% in the first half of the year. As we implement the cost management initiatives from the group-wide cost review, we expect to continue growing profitability and profit margin. Our continued investment in enhancing our market-leading proposition makes Transact an ideal platform for both large consolidators and small financial advice firms. The increased efficiency from the implementation of AI and automation in our proprietary technology will allow us to better serve our clients and deliver for our shareholders. We are well positioned to drive sustainable earnings growth. Thank you for your time, and we'll now open to questions.

[Operator Instructions] Our first question this morning is coming from Ross Luckman calling from Peel Hunt.

Just one question from me. You've obviously reiterated your cost guidance for just 3% growth over the next 2 years, supported by those efficiency initiatives, which is great. How do you think about the ongoing investment and cost growth required further into the medium term to support the platform?

Yes. Thanks for the question, Ross. I think over the medium term, we believe we're now reaching a good cadence of finding cost efficiency, but also tempering that with the ability to allow us to invest in the business as well. I think that's being demonstrated through the half year results and our ongoing commitment to the cost guidance over this year and next. When you look beyond FY '27, we've always got to be a little circumspect about what the future may hold from technological change. At the moment, as current things stand, we believe we can still maintain a low level of cost growth going forward. Some of the primary reasons for that are that the way that technology has developed over recent years is that you don't necessarily need a step change in technology investment. You can have a better cadence of cost growth increase and investment. So we remain comfortable with the guidance and also with basically what the market is expecting around cost growth from FY '28 onwards.

Next question will be coming from Michael Sanderson calling from Barclays.

A couple of questions, if that's okay for me. First one, obviously, one of your peers has decided to start charging on or retaining interest having not been in the past. I just would love to know your thinking about the change in that and whether advisers genuinely care and end clients genuinely care on your principled stance that you've held throughout your existence. Second question was obviously, seeing a lot of transfers across. Interested if there's any color on the sort of adviser types and client types that come in that transfer? Is it different behaviors, different style, different requirements that you need to address as a result? So interested to know if there's any material change there. I'll leave at those two at the moment.

Thanks, Michael. Okay. So I'll pick up on the retention of client interest piece and perhaps leave -- perhaps let Euan pick up on the transfers piece. But on the client interest, yes, it was -- from our perspective, it was disappointing to see yet another major platform decide to actually move to taking a share of client interest. It's not so much the principle of taking the interest that we see as sort of problematic. It's actually the actual impact in the size of the charge that, that relates into the client relative to the charge that would otherwise apply to the cash that's on the platform. And it is a significant increase in multiple that is being generated by this change. And actually, our biggest issue is on the transparency of that through to the end client when they are actually selecting their platform, making the decisions on their investment and actually putting their monies on the platform. And that's where we think that there is significant room for improvement. And we've had the results of some independent surveys that have been done that have shown that when you actually get to the end client, they have no idea this is happening to them, and they are not actually very impressed when they find out it is. So there is clearly a failing in the disclosure part of this. And that's the part that concerns me the most because it's actually not giving the clients a fair view of what's actually happening with their monies and what they're actually paying for being on the platforms.

And Mike, on your second question on transfers, a few things that are probably worth noting. And so firstly, it's great to see that we see a good deal of variety in the net transfers at an adviser level, both from new and existing advice firms. Secondly, we're seeing transfers coming in from pretty much all of our competitor platforms on a net positive basis. So it's not just due to the misfortune, let's say, of one individual platform provider, it's across the piece, which gives a great representation of the strength of the overall proposition. And kind of moving on to your specifics around style and requirements of adviser firms and clients. It's difficult to say because there's a number of different things that adviser firms look at when they're contemplating platform selection. So it will be a combination of things that we need to remain strong in all elements of. So it might be our personal service that helps move them over because of the reputation we have there, the value that we're offering at a great price, the functionality that we offer and also the product diversity. As we've kind of disclosed over the last year, 18 months now, there's quite a lot of change going on as a result of the government budgets and a shift towards bonds. And we have a great product offering there from both an onshore and offshore bond perspective, which also gives us -- puts us on the front foot for transfers. I hope that helps.

We'll now move to David McCann of Deutsche Bank.

So first question for me. I mean, April numbers you've given today suggest that you benefited from the market uplift and indeed, net inflows have continued, which is obviously good to see in April. I just wondered more generally from what you're seeing in both April and May in sort of underlying client and adviser sentiment given there's obviously growing inflationary macro and other sort of U.K. political noise out there. So any sort of signals of any kind of change there would be interesting and particularly seeing that actually translate into actual flow changes. That's the first question. Secondly, maybe you can touch on what the key drivers of those fairly notable increase in the regulatory capital requirements were in the period, given they were quite large. You kind of glossed over them, but perhaps you could talk why they actually have increased that much? And then finally, third question, you reiterated the 60% to 65% dividend payout ratio at the full year. So that's pretty clear. You also previously talked about the interim dividend being based off of 40% to 45% of the prior year's final. This time, it was 47.5%. So maybe if you could just talk to that, is there actually a change here? How should we think about that ratio for the interim going forward?

Thanks, David. Picking up on your questions on sentiment. I mean we sort of, March, April is always sort of an interesting mix because we have sort of the cutoff for the quarter at the 31st of March and the tax year-end falling variously across that with working days dependent on where Easter falls. So this year, we sort of certainly saw a Easter falling in a structure that it created most of the pensions inflow monies coming in at the back end of the tax year, all falling in March. And then ISA monies, you get the catch-up on people who are putting in their last minute contributions followed by a sort of large uptick in the start of April of people putting their new ISA monies in. Whereas on the pension side, you tend to get an outflow swing in April at the start of the new tax year as people who have been sort of wanting to take monies out of their pension wait for the new tax year to start. So it's always a little bit variable across that period. But we saw everything holding up really strongly relative to last year. And then even moving on from that, it tends to be a quieter period towards the end of April, but we're not seeing anything sort of any quieter than normal in an April period. There doesn't seem to be any sort of negative sentiment flowing through that period. And even into May, it's sort of continued to be a relatively positive market. I think whilst there's an awful lot of sort of noise geopolitically and even in the U.K. political landscape, that's not actually yet really translating into anything that's resulting in people's ability or propensity to save being reduced. There's still the need for people to be saving for their pensions. There's no sort of surge in job losses or anything of that nature. I mean, even this morning, I mean inflation has come in somewhat lower than expected. And I still expect we all think that there's going to be some spikes to come in that. But at the moment, none of that is really translating through into things that impact the sentiment in the advice market.

Yes. And then on your question on the regulatory capital requirements. So firstly, I'd just like to say that, that rise is not expected to continue at that rate going forward. But however, delving into a little bit of detail on that, you'll probably be aware that we have 3 regulated entities across the group, 1 investment firm and 2 insurance firms. So these change in regulatory capital requirements was driven by, firstly, around half of it was from our investment firm. And that is a relatively formulaic change because of the way the investment firm regulatory capital requirements work. The second -- the insurance piece is based on actuarial valuations on forward look. So there's quite a lot that goes into that, but I wouldn't anticipate that, that rise would be of the same value going forward. So -- but yes, you are right to note the rise. On the dividend piece, I think I've just tried to do some calculations on where you got your number from. I think your 47.5% is 47.5% of the second dividend from last year. So how we generally look at the first dividend of the year is it's probably going to be around the 35% mark of the total dividend for the prior year, which was 11.3p per share. So I hope that helps on kind of modeling the first interim dividend going forward.

Did this answer your question, sir? Next question is coming from Greg Simpson of BNP Paribas.

Three from my side. Firstly, just wanted to check in on the dividend and why you think 60% to 65% is the right payout and why it couldn't be more, given you're highlighting the 100% cash conversion, there's limited CapEx, limited appetite for M&A. That's the first question. Second one is, kind of goes back a bit on the previous question. It sounds like inflows are looking fine, but just wanted to check if you're seeing anything on the outflow side, given pensions coming under inheritance tax soon and also presumably some upwards pressure on mortgage rates from current rates? And then thirdly, on the consolidators, thanks for the color. I just wanted to check, are you willing to flex your fees to get some of these larger firms on board? Or are you -- is every covered advice firm on the kind of standard Transact fee schedule?

I think on the -- I'll take the dividend question, Greg, and then I'll pass over to Alex for the other 2. So on the dividend, what we're trying to illustrate in the presentation is that we remain comfortable in the level of liquidity we have across the group. So kind of David also hits on a question where sometimes there are changes to regulatory capital requirements. So we do need to be able to weather that in order to -- and still have sufficient liquidity to pay dividend to our shareholders. So at the moment, we feel that we have the right level of liquidity within the group. So if you look at the slide, in total, we have around -- at the half year, we had around GBP 20 million of liquidity in our group company, i.e., the one that pays the dividends out to shareholders. There was a little bit of a buffer due to timing differences of profit generation and paying dividends from our subsidiaries up to the group company as well, but we remain comfortable with that level of where it is at the moment from a dividend perspective. That's notwithstanding the fact that the Board do keenly look at the amount of liquidity we have available, and we want to remain as efficient as possible with our liquidity and where we see we are developing excess liquidity. We do discuss those levels, but we're not at that point at the moment. Over to Alex.

Yes. So on your question on outflows, I mean, where we are at the moment, outflows are relatively stable. We've not seen any big upticks from the current sort of environment issues. I am wary when I make a comment like that because we all know what's going on around the world and inflationary drivers will be the predominant point of what causes outflows to go up. That will sort of apply to people in pensions drawdown who need more to live on. And your point about mortgages, although I'm slightly more bullish on the mortgage point for the moment because the -- we sort of have seen for the last 2 or 3 years, people replacing their sort of very low interest rate-based mortgages that were for fixed periods. They're sort of -- we've been through a cycle as people have had to move on to higher rate mortgages. So I would be hopeful that there's far less impact of that in terms of pushing outflow rates higher. But I had anticipated probably 12, 18 months ago that they would start to sort of level off and maybe even come back a bit. And certainly, with the current environment, I don't see that happening. But we're not seeing any big uptick at the moment. And then coming to your point on consolidators, our line has been the same forever. We don't do pricing deals. We have a rate card and we sort of keep people on that rate card. It's hugely important for actually maintaining sort of the stability of the business and actually sort of controlling systems, and it just makes everything more efficient. So there's lots of reasons why we don't do individual deals on consolidated groups. And I think there's a realization actually that what we deliver to our clients, the value for money, what we actually sort of provide across the platform, the technology, the service, the support for advisers that actually we're not needing to do special deals to be able to win the business.

[Operator Instructions] We'll now move to Ben Bathurst of RBC Capital Markets.

I've got questions in 3 areas, if that's okay. Starting with one on cost development in FY '26 for Euan. I wonder if I could just reference back to the cost waterfall guidance from results last year. Do those percentages of 2% investment, 3% inflation and 2% cost savings that you set out in December, do they still apply? Or have those numbers moved around at all even if that 3% sort of final destination is unchanged? Then secondly, on AI, you've spoken about assessing use of AI and automation. Just given the amount of development work that you do on the platform, should we be thinking that there could ultimately be a cost-saving angle for the group linked to the deployment of AI? And when do you think you'll be in a position to sort of conclude your assessment of this? And then thirdly, on the consolidation opportunity, really a high-level question, but what proportion of consolidation businesses out there do you think are amenable to using a third-party platform and using panels versus the proportion that are going it alone? Have there been any changes in industry norms in that respect in the last couple of years?

Yes. Ben, I think -- thanks very much for your questions this morning, Ben. On the cost side, I think the brief answer is going to be yes. Those percentages still apply. We've been delivering savings through the first half of the year. We have more to make during the rest of the year, but there is an ongoing investment program that we also have where we are increasing costs on the investment side in H2 as well as we hire certain resources in order to deliver on future requirements. Sorry about the short answer, Ben, it's quite simple because the answer is yes.

Great. Okay. So on the AI point, Ben, I mean, the way I'm looking at this at the moment is what -- we have a very experienced development team. In fact, we have a couple of development teams across the business. And what I would expect in certainly the sort of short term is that what we'll see is that AI will allow more to be developed by fewer people. But that doesn't mean that we're going to have fewer people. It means we'll be doing more development, but we should be able to slow down the speed of growth of the development -- number of developers and therefore, the cost of development as we continue to grow the business. So that sort of feeds into the sort of the cost per servicing of each client coming down, driven both by increasing numbers of clients, but also driven by an actual ability to develop the systems in a way that is cheaper than -- or per capita is cheaper than it is today, if not actually cheaper. So it's going to be very much a moving feast. And we're very, very aware of moving this at, should we say, an appropriate rate such that we are investing where we can see very clear benefits of doing so. But it's a balance between investing sensibly to do that and not throwing loads of money at something that isn't going to give any quality of return in the long term. So this is very much as slowly as we go and actually sort of learning not just from our own experiences, but from what's going on around us in the market as well. And then coming to your point on consolidators. I think from our perspective, we are seeing pretty much all consolidators prepared to open discussions. That doesn't necessarily mean that they're ready and prepared to move or to add us on to platform panels. But we've seen a significant shift in the last probably 6 to 9 months in terms of an understanding amongst a lot of the consolidator firms that what they thought they could perhaps benefit from financially by running their own platform is nowhere near as easy to deliver as they may originally have thought. And that's actually causing many of them to reassess their view and perhaps consider that they can run their own platform structures for the more easy cases, the less complex tax requirements, but they need the capabilities and support of an established platform to deliver sort of for the more complex clients. And they need to be able to provide for every type of client because that's the nature of the consolidated businesses, is they're buying advice firms that have every type of client within them. So I think the answer -- the rather simplistic answer is it's all available. It probably isn't 100% of the business of each of them that's entirely available, but that's unfortunately then very dependent on the firm in question. So it's difficult to give you any sort of specific answer, but hopefully, that helps give a bit of color to it.

We have another question now coming in from Hal Potter of Bank of America.

Just 2 of them. So on costs, we saw occupancy had the benefit of rebates and the provisions release. So what are your expectations for this line item in H2? Are they effectively nonrecurring? And then my second question is on capital, which is as you accelerate profit growth, is the dividend going to remain the key focus? Or would you ever consider other potential uses of capital?

Thanks for the questions, Hal. On the cost side, on occupancy, yes, there were some nonrecurring releases of provisions. So it would more likely move back to probably what you've got as an expected run rate for occupancy there. So similar to -- well, not similar to prior years because we had dual running of property as well. But you've got to remember, it's a very small line item for us because due to accounting treatment, the predominant impact of our premises costs comes through depreciation and interest in our P&L. The -- from a capital perspective, we -- at our full year results, we talked through our capital allocation policy. We do regularly talk at a Board level as to what a level of surplus looks like and if and when we should be discussing returns in excess of our dividend policy. As I said earlier in the Q&A, we're not at that point, but we do discuss it at a Board level periodically and keep testing the water with it. So at the moment, no change to -- in summary, no change to dividend policy.

As we have no further questions in the queue, Mr. Scott, I'd like to turn the call back over to you for any additional or closing remarks. Thank you.

Thank you. Just to thank everyone for your time this morning and wish you all a good day.