Iress Limited (IRE) Earnings Call Transcript & Summary

Good morning, I'm Tony D'Aloisio, the Chair of Iress. It's 11:30, and I declare this Annual General Meeting open. I'd like to begin by acknowledging the traditional custodians of the land on which we work and live and recognize their continuing connection to land, water and community. We pay our respect to elders past, present and emerging. As you know, today's meeting has been convened as a hybrid meeting. And I think all those that are taking part and joining us online via the Lumi platform, and to thank those that are here at the RACV Club in Melbourne. So welcome to those logged in, and welcome to you here. And I say at a personal level, it's good to be back in person with you. So let's hope that, that will be also the position [Audio Gap] just for those that are actually attending in person, I need to run through emergency procedures in the event [indiscernible] the building. There are 2 exit points from the building outside this room. The building supervisor will direct us once out. There's an exit via the route that we entered these rooms on the right through the corridor, through the lift lobby and the fire stairs. The other is through the service area to the left, exiting the room, which exit [indiscernible] find us. I will, in a moment, say a few words concerning how I'll run the meeting but just some introductions. First, with the exception of Niki Beattie who's online in the U.K., the Board members are here in person today, and they are John Cameron, Michael Dwyer, Julie Fahey, who is also Chair of our People and Performance Committee; is also a chair of our Audit and Risk Committee; Roger Sharp, our newest director and Chair-elect; Geoff Tomlinson; Trudy Vonhoff and Andrew Walsh, our CEO and Managing Director. They've just made an appearance online there for you to have a look at in case you don't recognize them in front of the room. Also, in attendance here today are Peter Ferguson, Chief Legal Officer and Company Secretary; John Harris, Chief Financial Officer; Joe Muraca from King & Wood Mallesons, our lawyers and Tom Imbesi from Deloitte, our audit partner. Our auditor will be available for any questions when we consider the financials, which will be the first item of business. Talking about that, the agenda today is as follows. There will be the presentation of the 2020 financial statements and reports, then the election of Roger Sharp as a director and the reelection of Niki Beattie and Julie Fahey as directors. There will be 3 separate resolutions. And just to pick up Niki in the U.K., Niki is our U.K. resident director and, of course, she's in London, and they are still, I think, in lockdown, although things have improved there tremendously, which is good. And the [indiscernible] but she looks wide awake. [Audio Gap] The third item of business is the advisory resolution to adopt the remuneration report. And the fourth item of business is the granting of equity rights to the CEO. This item has got 2 parts, the equity rights and the performance rights, and I'll say a lot more about that a little later. And just to remind you that the first of these matters are the [Audio Gap] is not a voting item, it's for tabling and discussions. But the resolutions regarding the election, reelection and the grant of our equity rights and performance rights are all ordinary resolutions, which will be put to the meeting, including the remuneration report. Some more formalities. I'm advised that due notice of the meeting has been given in accordance with the requirements of the Corporations Act and the ASX Listing Rules and that a quorum is present. I will take the notice of meeting, which, of course, was distributed to you as read. In relation to proxies, proxies as provided in the Notice of Meeting were to be lodged 48 hours before the meeting as is usual. Now in relation to proxies that we've received, which appoint me as the Chair, as the proxy, where the proxy holder is directed that I vote in a particular way. I will, of course, vote in that way. Those proxies that are directed to me but are open, I will vote those proxies in favor of the -- of each resolution, which is in accordance with the Board's recommendation on all voting resolutions. Now because we have hybrid and in-person or online and in person, I need to spend a little bit of time about questions and about voting. So please bear with me. Those that are attending in person and those attending online will have the opportunity to ask questions and, of course, to vote on each item of business. On questions, the process for questions, there's clearly an opportunity to ask questions on all items of business. And I'll first ask those that are attending in-person for questions, and then I'll move to the online questions. And that will give the online participants a little bit more time to type their questions for us. Now for those attending in-person, and they wish to ask a question, fairly straightforward as in the past to move to one of the microphones on either side of the room, state your name and who you represent prior to asking the question, and then please ask the question. Now for those attending online, questions can be submitted in writing at any time. [Operator Instructions] You can submit questions from now, but we will address them as we deal with each item of business. All questions will be read out in full, asked in full. There will be no moderation or summaries of the questions that are asked. So that's questions for in-person and online. Now to voting, in terms of -- as I said earlier, each voting resolution to the meeting will be an ordinary resolution and will be passed by simple majority. The voting restrictions on all -- for all resolutions are included in the voting exclusion sections in the explanatory notes of the Notice of Meeting. Voting today is going to be held as is usual for Iress by way of a poll on all resolutions, and I appoint Faith Sullivan from our share registry, Computershare Investor Services, as the returning officer. Those entitled to votes are all shareholders, representatives and attorneys of shareholders and proxy holders, who, if you're attending, should be holding a blue admission card. To provide you with enough time to vote, I will shortly open the poll for voting of all resolutions, and voting will remain open until I declare it closed at the end of the meeting. Now as we go through each resolution, the proxy results that have been received in advance of the meeting will be shown and those voting for and against. Now in terms of the way that I'll conduct the poll. First, for those who are attending in person -- by the way, if there's anyone that's present that believes they're entitled to vote not holding a card, you should approach the register and obtain a card so that you may vote. And as I said, you will have received a blue card. On the reverse of that card is the voting paper, which details the resolutions put to this poll, and the relevant instructions are also printed on the reverse of the card. And as you know, you fill in your voting card by for or against and mark it accordingly. And there are procedures about the proxies you hold and how you vote them. And please make sure that you print your name, where indicated, and sign the voting paper. When you are finished, please lodge it in the ballot box to ensure that your votes are counted. So that's the normal sort of process for voting on a poll in person. Now we're also voting -- for those that are voting online, if you're eligible to vote at this meeting, the polling icon will appear in your browser, as you see in that image, which is now being displayed. Select that icon in your browser that will bring up a list of resolutions and present you with voting options. And to cast your vote, simply select one of the options. There's no need to hit a submit or enter button as the vote is automatically recorded. But you can, however, change your vote during the meeting, if you wish. Now if you experience any difficulty in your online, submitting a question or indeed or voting, please consult the Investor Center section of your website for further assistance. I'm now going to declare all resolutions open for voting. And as I said, at the end of the meeting, I'll give you a warning when I'm about to close the voting. And I think voting has now been opened. I'm getting the thumbs up. And just to remind you that subject to any applicable voting restrictions, the Board recommends that shareholders vote in favor of each resolution. So thank you for bearing with me. That completes the formalities for both in-person and online in terms of questions, voting in relation to each resolution. In a moment, I'm going to ask Andrew Walsh, our CEO, to deliver his yearly AGM address. But in introducing Andrew, let me make some observations. As you know, from the announcements we've made, this will be my last AGM as Chair of Iress as I'm stepping down at the close of this meeting. It's been an honor and a privilege to have been a director and chair over the past 8 years, and I thank the Board and you, the shareholders, for your support and, importantly, the management team led by Andrew. While I, like you, would have liked -- would like our share price to be better, I do feel very confident in the strength of the company from the quality of its software and the depth of its enduring client relationships as well as its geographic reach. And indeed, an example of that strength and resilience of Iress is its response to the 2020 pandemic. The Board is pleased with Iress' progress against its strategic objectives during this period, including attracting and retaining high-quality people, achieving operational efficiency, target investments in areas such as cloud and improved client and user experience. Acquisitions completed during 2020, including the acquisition of OneVue, are designed to further strengthen Iress, drive growth and increase shareholder value in the medium to longer term. There are substantial investments that Iress has been making. And clearly, the Board feels that the benefit of those investments will come through and come through well for shareholders. The 2020 results were ahead of our guidance aided by good momentum in the fourth quarter. 2020 pro forma segment profit was $155.6 million, which was 5% ahead of 2019. More than a year into the pandemic, these results highlight the strength that I was talking about of Iress' businesses and its growth. As we said in February, the final dividend was $0.30 per share, franked to 40%, bringing full year 2020 dividend to $0.46. This was franked to 38% on an average weighted basis. Iress continues to maintain a conservative balance sheet at a leverage ratio of 0.8% segment profit, including the successful capital raise in May, net debt fell by 36% during 2020. In terms of taking Board succession a little bit further, Iress is a firm believer in the importance of Board renewal to our company's continued success. And you may -- those of you who were here, you'll recall that 2 years ago, I outlined the Board's succession plans. There has been an ordinary succession with 2 new directors coming on in that period, Michael Dwyer and Trudy Vonhoff, and 3 directors rotating off the Board, Jenny Seabrook last year; John Hayes and Geoff Tomlinson today. On behalf of my fellow directors, I thank John, who has been a nonexecutive director for 10 years and Geoff, who has been a nonexecutive director for 6 years for their commitment as directors and for all they've done for Iress. And at a personal level, I thank each of them for their support to me as Chair. And I had the opportunity, of course, to thank Jenny Seabrook at last year's AGM. Now this succession is also extended to the Chair role. And following an internal and external search, we're pleased that Roger Sharp has been selected by the Board as Chair-elect. Roger will speak to you later in the meeting. So I want to thank my fellow directors, Iress management led by Andrew, all of the people of Iress and you, particularly, shareholders, for the support you've given me and the Board. I actually will miss you all. In fact, I might have missed the proxy advisers, who knows? But I do look forward to continuing as a shareholder and enjoying Iress' continued success. I'll now ask Andrew to deliver his address.

Thanks, Tony. And thanks, in particular, for your support and guidance as Chair, which has been invaluable and much appreciated by me, fellow directors and management. I also thank John and Geoff for their long service and expertise and experience that you've brought to the Iress Board, again, much appreciated, and we you both the very best for the future. Also, a warm welcome Roger to the Board as Chair-elect. Our management team is looking forward to working closely with you and further success at Iress. Today, I will cover the progress of our key focus areas and operational progress, including more details on financials and recent acquisitions. Our goal at Iress is to be the essential partner for forward-thinking financial services of businesses. On the strategic priorities that Tony mentioned, we're making sound progress. Attracting and retaining the best people sits at the core of successful technology businesses. Our current and former people rate us highly versus technology competitors on a global basis. Operational efficiency is critical to all aspects of our business, including financial outcomes but increasingly, on client and user experience. We're seeing this in our financial performance and in feedback from clients and users where investment in our technology platforms are driving consistent outcomes, high-quality deployments at scale. Our progress in migrating clients to the cloud is strong, in Australia where the cloud program has started 2/3 of services under that program have now moved to the cloud. Global services migrated year-to-date in 2021 have increased at a rate of 33% over 2020. Our focus as a management team for shareholders is to generate higher returns on our growth investments, higher returns on those growth investments than the group at large. They will translate to returns to shareholders as measured by return on invested capital and earnings per share. We're particularly focused on growth opportunities in superannuation in Australia, in the United Kingdom and following the OneVue acquisition and in scale benefits that come from investment in product and technology. We're advanced in our delivery of a new market offer in Australia, following the successful acquisition and integration of OneVue. With OneVue, we will be able to offer clients an open, seamless, highly efficient investment infrastructure that does not currently exist in Australia. We look forward to sharing more news with shareholders as this year progresses. Servicing clients exceptionally and delivering a compelling end-user experience is at the heart of Iress. The addition of 2 executives during 2020, Joydip Das as Chief Product Officer; and Michael Blomfield as Chief Commercial Officer, will continue to drive a client and user centered culture at Iress. As Tony mentioned, Iress has proven itself to be resilient during the pandemic that we continue to live in. We've also proven to be adaptive. And I'm proud of how our team of more than 2,000 people has continued to deliver to clients and end users during this time. I'm also humbled by what many people have dealt with over the past year or more, including the loss of loved ones during pandemic and long periods of lockdown. Often that is involved juggling young children and work responsibilities while everyone is locked up. We continue to emphasize well-being and mental health, including sharing our experiences and challenges in this world. Adding to Tony's comments on our financial results for 2020. APAC was a standout performer with revenue up 10%. Our strong Australian businesses continued to deliver growth with consistently high returns. We've made good progress in executing on our growth strategies, including turning QuantHouse to monthly profitability and in providing Australian superfunds with a highly efficient, outsourced administration solution. In the U.K., though, we were affected by restrictions relating to the pandemic in 2020. And while our significant growth opportunity remains intact. Project timing and new business development has been delayed as a result of 2020 with revenue growth deferred. 2021 has started well for Iress, and we have a positive outlook. The guidance we provided in February for segment profit growth in constant currency of 7% to 10% is unchanged. Thanks again to Tony, John and Geoff. Thank you to the leaders and everyone at Iress, our shareholders, for your continued support. Thank you.

Thanks, Andrew. Now we come to the formal part of the business of the meeting. The first item is the presentation of the financial statements and reports. And that item of ordinary business is to receive and consider the full financial report for the year-end December 31, 2020, together with the consolidated accounts of the company and its controlled entities, in accordance with the Corporations Act 2001 and associated directors' and auditor's report. These have been tabled and are, of course, in the annual report. Now this is not a voting item, but shareholders can, however, ask questions. Before I move to those, I'd like just to take the opportunity to thank John Hayes, who, from the close of this meeting, not only retires as a director but also as Chair of the Audit and Risk Committee. I'd like to also congratulate Trudy Vonhoff on her appointment as Chair of that committee from the close of the meeting. Thank you on your behalf to both of them. Under this item, our auditor, Tom Imbesi, is also available to answer questions on such matters as the conduct of the audit, the auditor's report, the company's accounting policies and the independence of the auditor. So as I said, this is not a voting item, but we would be pleased to receive questions. The question function is open online, so please raise any matters you believe you'd like us to answer or comment on. So as I said earlier, I'm first going to take questions from those in-person here at the meeting. And I'll direct the answers to those questions to the CEO or myself or whoever is appropriate to provide the answer. So are there questions from those at the meeting under this item? Thank you. Please, the microphone, state your name and company. We know you, but you have to follow my formalities.

And I'm following mine. Good morning, Mr. Chairman. My name is Eric Pescoe, and I'm representing the Australian Shareholders' Association. And we have 280,000 proxy votes. And before I start, Tony, thank you very much for the way in your time that you've received the ASA. We've always been made to feel very welcome, and we really do appreciate it, and we wish you all the best of the future.

Thank you.

Mr. Chairman, for a long time now, Iress has enjoyed excellent sales results. In fact, its revenue has gone up something like 160% over the last 9 or 10 years. But the company hasn't been good at containing its costs. The company continues to perform poorly on very important metrics, such as return on invested capital, return on equity and total shareholder return. The ASA doesn't think it's appropriate to explain away that scoreboard either nor suggest or ask shareholders to keep on trusting you that it's going to all come good at some time in the future. So shareholders are looking for signs that the Board understands how critical these metrics are and what actions you are taking now to ensure satisfactory returns in the future?

I think, certainly, at the Board level and management level, we definitely get the point that we want to be able to drive EPS and ROIC up. The company is doing extremely well. The investments we've made, a number of those investments are very long term. And I accept that shareholders need to be -- will have a degree of patience, but we do get and are working on a number of initiatives and strategies. And I think probably with fresh eyes from Roger and the new members of the Board, I think that will add new parts to the management. I think that will add additional impetus to focusing on those issues. And that, by far, is the biggest issue for the company going forward. But I'm going to ask Andrew to talk a bit more specifically on those points.

Thanks, Tony. And certainly not explaining away the impact on bottom line, Iress is made up of several parts. And I think assessing at only the reported result doesn't provide the full picture. We have businesses that operate at very high margin and high return. We have businesses that are very targeted growth opportunities that we've explained to the market what they're -- why we're investing in those and why we're pursuing those because we believe that they're in the best interest for Iress and shareholders over the medium term. Several of those investments and growth strategies have also had the support of shareholders as we've gone into those investments. Having said all that, we recognize that it needs to flow through to bottom line metrics for the benefit of shareholders.

Thank you. Other questions, no? Sorry, I wasn't sure what -- there was 2 lots -- no, no, no. There was 2 separate discussions going on between.

[indiscernible], a common shareholder. And my question is for the auditor, which is very appropriate. The auditors don't get enough questions. And it's to do with the goodwill. And the goodwill is a bit questionable for me because I grew up in the country.

Sorry, Tom is just getting ready to answer.

You've lost my flow. I grew up the country where I've always taught in law, finance, redefine print. So first question, why is your fine print about half the size is the normal report because I've got glasses, and it's fairly difficult.

What kinds [indiscernible].

The auditor's report full stop. The other things that I'd like you to answer or comment on, you've mentioned here that you look to assess the key assumptions and you give one of them. I would like those to be included because if you believe they're key, I'd like to look them up. Then you talk about the review, the historical accuracy of forecasting the group, and the historical pipe -- I can't read it because it's too small. The historical pipeline conversion rate. Historical is a bit of a word. Historical means what's happened in other years. We want to know what you think about the projected things. And the biggest problem with this whole -- that section is COVID is regarded by Andrew in his report and the Chairman in the front of the team as a year like no other, and it doesn't get a mention. So I'd like you to comment what you did about COVID. And I wish you all the best.

Thank you very much. I assume this mic is working, yes?

Yes, it is.

Good morning, everyone. Firstly, to your point about the font in our auditor's report, I will take that on notice and see what we can do about that for future reports. It is obviously seeking to try and minimize the number of pages we consume in the annual report, but I do appreciate your comment in that regard. In terms of your comment around goodwill and COVID, I'll address both of those together. Clearly, if you look at the balance sheet of Iress, its largest asset group are intangible assets. And within intangible assets, goodwill is, by far, the largest subgroup, within intangible assets. So they do get appropriate attention from management, I should say, in the first instance and the Board secondly, and certainly get due attention from us as auditors. In terms of the process that is undertaken, management do prepare financial cash flows to support the carrying amount of goodwill. That is their obligation. And then the Board's obligation is to assess and consider those as appropriate. We challenge those cash flow assumptions and the reference to our report. And I think you're referring to Page 96 in the annual accounts where we set out the steps that we undertake as auditors. What I will highlight in our report is that in respect to goodwill, it is the U.K. mortgages that we see having a higher level of risk in terms of carrying that goodwill compared to other parts of the Iress business. And therefore, that's why we specifically comment on the U.K. mortgages' goodwill and the procedures that we've undertaken in that regard. So the 2 points that you asked me to consider specifically. One is the historical reference. So we do look at history. Whilst the management's basis for carrying the goodwill is based on prospective or forward-looking information. We do look at the company's ability to mediate historical targets. And that gives us a sense of confidence in terms of the accuracy in forecasting going forward. So that's why we do the look-back test to give us confidence about the company's ability to forecast going forward. In terms of U.K. mortgages, we specifically do look at pipeline conversion because it is the growing part of the Iress business. They do need to bring new customers in and convert them onto their platform. So we also check how successful they've been in recent years in attracting new customers and converting them. If they do convert new customers on the best systems, then that subscription revenue kicks in. And that's what the objective of that particular part of the business is. So that's the reason why we look at historical performance. We don't then disregard the forward-looking assumptions. I note your comment around that we don't note those assumptions. Management do include some of those assumptions in the detail of their own annual statements, in Section 2.1 of the annual accounts. So I would encourage you to look at those key assumptions around growth percentages, both short and long term, and the discount rate that's applied therein. We did particularly look at the impact of COVID on this particular business. And you'll also note, management do make a comment that this business, in particular, was affected by COVID, that there was a slowdown in the number of new conversions that did occur last year, largely impacted by COVID. We had regard to the assumptions about those customers and their interest in continuing those implementations in the current and future years. And we were satisfied that the pipeline did exist and that the pipeline should reasonably expect to convert to new customers over the next 18 months in particular and support the growth assumptions that management have applied. So on that basis and based on the work we did undertake, we did conclude an unqualified audit opinion.

Thanks, Tom.

Thank you, Tony. I'm Paul Fanning. And I'm also representing the ASA, and Eric heads up the team. Two points I'd like to raise. One is the -- I'm not really -- we're not really very happy with the overall 10-year performance of profit at reported level. Share-based payments are of a concern, and I've noticed this for a few years. The share-based payments seem to come off at after segment profit has been declared. The guidance seems to be given on segment profit, but we don't tend to get guidance at a reported level. If there were, then the result is quite lackluster. I'd like to comment on that. The second part is, I'm looking at Page 4 of the notice of meeting. I'm a bit concerned about one of the product groups, i.e., South Africa. Again, I've watched the performance of South Africa over a few years. Would it be time to perhaps revisit the South African operations and maybe put up for sale? Or can it be greatly revitalized? Or are there exchange rate issues? What is it? I've noticed it contributes 8% of revenue. In sum, those were my 2 questions.

Thank you. On the first question of the 10-year performance, I note -- we note what to say. And as we said, earlier, clearly, the Board and management has got to be focused on delivering EPS growth in the future. So we note those comments. Thank you. On share-based payments, I'm asking John Harris, the CFO, to address your issue. And if Julie's got any comments as well as PPC, and then I'm going to ask Andrew to talk about South Africa, which is a good little business. But I'll let Andrew talk a bit more about that. John, the share-based payments and the changes we've made.

Thanks, Tony. Two comments I'd make on share-based payments. The first is that there was a change to the nonexecutive remuneration scheme a couple of years ago. And that resulted in a change in the accounting treatment for the expense of that scheme. And so you would have seen in the years 2019 and 2020, a significant increase in the expense we booked for share-based payments. That did not represent an increase in the amount of shares that we issued to our employees. It was a change and an acceleration, in fact, of the accounting treatment of that expense. So that's my first comment. Your second comment was in relation to the fact that we use segment profit as a measure of our underlying performance. We have provided guidance this year to the market down to the NPAT level. So hopefully, that additional disclosure and that additional insight into how we see the whole P&L evolving will be useful to you and other shareholders. And we do very clearly, in our financial statements and in our presentations to investors, explain the gap or the difference or the various line items in our P&L that go into segment profit and those that go into the full NPAT, net profit after-tax, number. So hopefully, those disclosures also help you understand the other items on our P&L that don't form part of segment profit.

Thank you. Andrew, South Africa.

In relation to South Africa, South Africa is a good business. It's a business that has the combined effect of acquisitions and organic growth, and we have seeing it perform and provide returns to Iress following acquisitions and investment in organic growth. That's not to say every business performs at its height every single year, and there are certainly challenges in South Africa at this time. But we believe that it is material part of what we do at about 10% of revenue, a key contributor and full of opportunities. Having said that, we think about the different business units and assets of Iress carefully as to whether we can maximize shareholder value by holding them and growing them or by not holding them. And so that is an active consideration by management not just for a unit like South Africa but in all areas.

And I think from the Board's perspective, I mean I think, they're going to the broader macro issues of that country and the risks. And clearly, as a Board, we look at those periodically, particularly with South Africa, and indeed with the U.K. and other parts of the world. So we do assess it. And the Board's judgment on South Africa is as Andrew has said, it's a good business for us, and we'll just keep monitoring the broader risks. And if we need to make a change or change a decision, we will. And so that's where we are there.

Thank you. Are there any other questions from here, those in-person to the auditor or to any of us? Thank you. The company secretary has been monitoring the questions online. Peter, are there questions online?

Thank you, Tony. No, there are no questions online in relation to the auditor.

Hopefully, there are shareholders online.

There are shareholders online.

That's great. Thank you. Thank you, and thank you for participating.

We now move to resolution 1. This is a -- we now move to the voting resolutions. That completes the tabling of the financials. The first resolution, as is shown there on the screen, is that Roger Sharp, be elected as a director of the company. Now by way of background, Roger Sharp has 35 years experience in markets, technology and governance. He's got broad international experience in Australia, New Zealand, Hong Kong, Singapore, United Kingdom and the United States. He's Chair of the ASX-listed Webjet Limited, the Lotteries Commission of New Zealand and NZX-listed GO Limited. After his past executive roles, which included Global Head of Technology and Chief Executive Officer of Asia Pacific Securities at ABN AMRO, he founded Regional Technology Investment Bank North Ridge Partners. In terms of formalities, Roger was appointed a director by the Board on the 18th of February 2021, pursuant to 10.7 of the constitution. Before Roger's appointment, we agreed that he would reduce his Board seats to free up time for Iress. He's already given notice to 2 of his Boards and, by year-end, will only be chair of 2 listed companies, including Iress. The Board is very confident that Roger will devote the necessary time to Iress business. Now as you know, a director that's appointed pursuant to 10.7 of the constitution holds office until the conclusion of the next AGM, which, of course, is today, and is eligible for election at this meeting. And he being eligible, he's offered himself for election. I'd now like to ask Roger to provide the meeting with some comments, and then I'll open it up to questions, both from the floor and from those online. Roger?

Thank you, Tony. I'll do a quick mic check. Everyone hear me? I guess this is where I sing for my supper. I'm grateful for the opportunity to join the Board of a good software company like Iress and for the confidence that Tony and my fellow directors have placed in me. Tony has just given a brief introduction, but I'll repeat some of it. I'm afraid this carbon dates me because for more than 35 years, I've had quite a passion for the tech sector. And in that time, in multiple countries, I have built, invested in, shared, run, sold multiple tech companies, some listed some private. And through that process, I think I have enough scars on my back to know what works and what doesn't. As Tony said today, I chair Webjet, also an ASX 200 company; currently, a small-cap called GO listed on NZX; and Lotto in New Zealand, which is the equivalent of [ Tax ] Lotto, which is a community service project, because it gives all its profits away. I also part own a technology investment bank called North Ridge Partners, which I work on, not in. It's a very important distinction. And I work on it because it exposes me to really quite up to the minute knowledge of what's going on in the tech sector across the world, which I find as one of the key arrows in my quiver as it were. There have been some questions about whether Roger is over-Boarded. And I just would like to say that throughout the recruitment process, I think, from the very first minute when Iress called, I did say, of course, I'd love to be involved at Iress, but I would need to resign a couple of Board positions in order to do it. And I would wish to resign those in an orderly way so as not to leave anyone in the lurch. Since accepting the role, I have now given notice at 2 other boards. And as Tony has said, by the end of calendar 2021, I will chair only 2 listed companies, being Iress and Webjet. I'm really looking forward to working with the Iress Board and with Andrew and his very talented management team. I've been doing a deep dive into the business for quite a while now, keeping everyone busy. And I've also, during that period, engaged with and received some pretty clear feedback from a number of the company's major shareholders. It's clear to me that our shareholders have a healthy respect for the company, for its management and for its market positions, but that our shareholders also want to see some improvement in the company's financial metrics. As your incoming Chair, I really do appreciate the directness of this feedback. I'm listening and undertake to continue to listen and do my utmost to deliver value for Iress' many stakeholders. In conclusion, I'd like to wish Tony D'Aloisio well.

Thank you.

And to thank him for his support during what I think has been a great transition. Thank you.

Thanks, Roger. Okay, both Roger and I are available, indeed as a Board, to address any comments or questions on this resolution. Any questions? I'll take the floor first here, and then I'll go online. Any questions? Thank you.

Mr. Chairman, according to the ASA's measure, we have a measure -- a point scoring system. Mr. Sharp was twice too busy to even be a director, let alone chairman.

Could you remind us of the metric, just...

Sorry.

Remind us of the metric?

Just a point scoring system for senior roles, a couple of points for being a Chair. And when added up, he had twice too many. Now I will accept, we've received some more information now, so that some doesn't play out entirely. But we were certainly universally alarmed. There wasn't even amongst the ASA in our discussions about being over-Boarded, as Roger called it. The other one is the ASA has a policy that directors should spend 12 months on the Board before assuming the role of Chair. And that's a very practical and sound thought to me. How does the rest of the Board know how they're going to get on with the incoming Chair? How does the CEO know how he's going to interact with the incoming Chair? How can the Chair adjudicate on matters -- how quickly can he acquire an intimate knowledge of Iress, the company? It seems a very practical suggestion from ourselves. We came to this meeting, my final line here is -- on my preprepared question is we are going to vote against Mr. Sharp, some moderation on that now with his foregoing his other roles. Outstandingly, now, the thing to me is, can you focus and deliver on the metrics that we were talking about earlier? That is becoming a real priority to me for Iress and the Board. You have to deliver in the next 12 months.

Let me just make some comments and then ask Roger. But basically, on the -- I think if I've understood the over-Boarded type issue, separately the over-Boarding issue. I mean, clearly, the Board looked at that. And as Roger said, the assurance has given in terms of what he's letting go are fine. And he is an individual of extreme energy and commitment, as you can even see in brief meetings you have. Clearly, he's impressed the Board with that energy and that approach, and the Board feels very comfortable that he's not going to be over-Boarded for the role. But on the technical part of that, if I use one of the proxy advisers because I'm not as familiar with the ASA. And if you go 2 for Chair, and 1 director, he's scoring is 5, and the cutoff is 6. So in a technical sense, I think he's there with the actions he is taking has stated. So I think he's both there technically. But more fundamentally, in terms of approach, style, position and commitment, we're very comfortable that he's the sort of -- he's got the caliber to be able to take the role of Chair. On the issue of the 12 months, look, as a company, you've seen me at these meetings, I've been very careful about having a succession plan because we -- the Board, it was time to -- for renewal, and I think shareholders understood that. And that renewable process for new directors coming onboard has been more than 12 months. So there's quite a lot of experience on the Board. Look, I'm sure that Roger and I could have worked together for another 8 months, 10 months. But really, I feel very comfortable with giving up the role at this AGM from what I've seen and the approach and the response has been to Roger. And given that I've given him all those accolades, probably better he doesn't say anything. But Roger, do you want to make some comments?

Thank you. Look, I understand the question. We've been in a courtship process for almost 9 months. And Iress would be about the most thorough company I've seen in vetting a new nonexecutive director, Chair-elect. This year, we've been through what can only be described as a deep dive. And I don't think anyone at this table would say I haven't committed the time, energy or resource to Iress because I've been nowhere else for the recent past and, if anything, just creating more work. To be honest, I think you're asking the wrong question. I think the question is, can this guy help? You've articulated some issues, as ASA, you're not happy. Well, I think the question is, can this man work with the Board to help deliver a slightly better set of outcomes? That's all I've really got to say.

Thank you. So I'd like to encourage you to change your vote and vote for. I think we had a similar situation a few years ago in another director, and I think I was right on that one. So thank you. Okay, there are no other questions from the floor. And company secretary, Peter, are there any questions online?

Yes, Tony, we do have a question online, and it's from [ Mrs. Carey Margaret Bible ]. There are 2 parts to the question. Do you have any definite ideas on how to deliver value? And if so, what do you propose?

Andrew? Was that -- sorry, was that a question to Roger?

I think it's -- I think that's the right interpretation, Tony.

I'm sorry. I'm sorry, I misunderstood that, Peter. Roger?

Part A, yes; Part B, working on it. It sounds a bit glib, but I'm about to be appointed today, and we will have a Board meeting in a couple of weeks, and we have a microscope that's out, and we're looking at everything. And it would be wrong of me to comment beyond that.

We're certainly in the discussions with Roger and the Board in terms of value for Iress. I mean we're very, clearly, going to be focused more, as we're saying earlier, on EPS, on return on invested capital and where the investments we're making and have been making are really geared to improve returns, as we've always said to shareholders in the medium to longer term. But we accept, and I think Roger accepts, the Board accepts that the next 12 to 18 months will be crucial for that question. So thank you.

[indiscernible]

I'm sorry, I didn't hear.

I think [indiscernible] was asking how many participants we have online, and I think the number is 21 at the moment.

Thank you. So that's a good question. We usually -- we would look at that at the end of the meeting to see how it went, but that's fine. Okay. Any other questions online, Peter?

No, Tony.

Thank you. Now the proxies -- now we need to vote. The proxies are there behind me. And if you're voting in-person for against or abstain. And as I said earlier, voting on resolutions remain open until the poll is closed. And for those voting on online similarly, use the voting function and please vote. [Voting]

We now move to the second resolution. This is that Ms. Niki Beattie be reelected as the director of the company. And that resolution is now before you. By way of background, Niki has more than 30 years' experience in financial technology and capital markets. She currently runs Market Structure Partners, a strategic consulting firm. Niki spent more than a decade in senior positions at Merrill Lynch International. She's currently a Non-executive Chair of listed equity Aquis Exchange Limited, which operates a pan-European stock exchange and technology business and a privately owned XTX markets. She's also a nonexecutive director of Kepler, a French brokerage firm. And as you can see, she has a number of other appointments. She's been a director since 1 February 2015 and retires as a director in accordance with rule 10.3 of the constitution. And she being eligible for reelection, offers herself for reelection. Niki is online, as I said, early morning in London. So thank you, Niki, for participating, but I'll ask her to make some comments before opening it up to questions.

Thanks, Tony, I'm just checking, you can hear me?

Yes, we can.

Thank you. Well, good afternoon, everybody, or morning in my time. Ideally, I would be in the room with you today. But obviously, it's based -- as I'm based in the U.K., we all know, it's just not possible for me to be the at the moment. Nonetheless, I'm very pleased to have this opportunity to tell you a bit about my background and why I'm excited, even at 3:00 a.m. in the morning, about continuing on my role on the Board of Iress. As Tony just said, by way of background, I have 30 years of experience working in financial markets, 17 of these were spent working for investment banks in trading technology and then strategizing for both the global trading and the client businesses as markets became more electronic and regulations changed. And for 13 years, I've successfully run a consulting business, specializing in providing strategic advisory services to policymakers, stock exchanges and banks and brokers around the world about the impact of technological and regulatory change. As a result of my experience, I have good up-to-date understanding of, and indeed a very great interest, in the different financial market structures around the world and the key drivers behind them. I knew of Iress long before I joined the Board, and I understand many of the challenges that its clients face in selecting and implementing trading and data software and responding to regulatory change as well as the international competitive environment. And as you know, Iress is, first and foremost, an Australian company, but it is increasingly an international one that is subject to the same challenges and opportunities as other businesses overseas. It's also a listed company, and it needs to maintain and involve the high standards of corporate governance. And during the last 9 years, I've built a portfolio of Board roles on both private and listed company Boards that provide me with a variety of business experience and governance experience that's both relevant and complementary to my role at Iress. I currently chair a European alternative stock exchange and a global algorithmic market maker, both in the U.K. I'm also a nonexecutive director for a subsidiary of a French agency broker and the Fixed Income Currencies and Commodities Standards Board, which was set up by the Bank of England. I've previously served on the Boards of 2 other international stock exchanges and on panels that oversee regulatory decisions in the U.K. and Europe. I have experienced on many audit and risk and nomination and remuneration committees, including sitting on the People and Performance Committee at Iress. I'm currently Chair of Nominations and Remuneration Committee of one of my other Boards and previously chaired the Strategy Committee for one of the international exchanges where I sat on the Board. I therefore, consider myself a professional nonexecutive director who's had to consider multiple different cultures and business context for each of those companies while serving on those boards. I've been on the Board of Iress since 2015, and it's given me time to understand the multiple strands of its business as well as to absorb the culture and observe the changes and challenges as the company grows. I'm very committed to the company and what it's aiming to achieve for its stakeholders. In summary, I believe that my professional, international background, along with my corporate governance experience, can be of ongoing benefit to value creation in the company, and I look forward to continuing to work with the other Board members and supporting our new Chair to help the company grow and to seize the most of our opportunities whilst maintaining the highest standards of corporate governance. Thank you.

Thanks, Niki. Are there questions from the floor for myself or Niki? No? Thank you. Mr. Company Secretary, online?

No, there are no questions online, Tony.

Thank you. I'll now put the matter to the vote. Behind me are the proxies. Please now vote, whether in person or online, for, against or abstain. And just a reminder, voting on all resolutions remains open until I declare the poll closed at the end of the meeting. [Voting]

We now move to the third resolution. The third director to be reelected -- or elected. And this resolution is that Ms. Julie Fahey be reelected as a director of the company. And that resolution is before you. Julie has over 30 years experience in technology, including a major organization such as Western Mining, Exxon, Roy Morgan, General Motors and SAP, covering consulting software vendor and Chief Information Officer roles. In addition to her industry experience, Julie spent 10 years at KPMG as a partner, with the firm during which time she held roles as national lead partner, telecommunications, media and technology and managing partner markets. She was also a member of KPMG National Executive Committee. She is a nonexecutive director of SEEK, Datacom Group, CenITex, Vocus Group and, more recently, EFIC, the Australian Foundation Investment Company and as well, she has not-for-profit roles. Julie has been a director of Iress since the 5th of October '17 and has been Chair of the People and Remuneration Committee since February 2020. She retires a director in accordance with 10.3 of the constitution and being eligible, she offers itself for reelection. And I'll now ask Julie to provide the meeting with a few comments. Julie?

Thanks, Tony. I had good morning here, but I believe we're now in the afternoon. So good afternoon, everyone. I very much appreciate the opportunity to address shareholders today and to stand for reelection to the Iress Board. As Tony mentioned, I've been a member of the Board for 3 years, and I've also served as a member of both the Audit and Risk and the People and Performance Subcommittees over that time. I took over as Chair of the People and Performance Committee in January 2020. I want to start by thanking Andrew and his leadership team for their outstanding commitment and continued passion for what I consider to be a great business with significant opportunity ahead. It would be remiss of me not to pay tribute to our retiring Board members and Chairman and to thank them sincerely for their contribution to Iress, well beyond my tenure. Tony, Geoff and John have provided me with great support and shared their wisdom on many an occasion. It has been the most difficult COVID year for us all. Throughout 2020, Iress has found innovative ways to assist our customers and our employees to deal with the challenges, clearly demonstrating the strong underlying culture and values of the organization. Our 2020 business targets were set well in advance of the onset of a global pandemic, which I'm sure we all recognize, severely impacted business confidence and delayed many decisions. Regardless, Iress delivered revenue growth in 2020, completed the strategic OneVue transaction and delivered uninterrupted services to our customers, a great credit to the leadership team. I came to the Iress Board with over 35 years' experience in technology across many industries through an executive career, spanning IT consulting and leading strategy development and operational delivery of technology. I'm an experienced nonexecutive director of 6 years and currently hold directorships at 3 other listed companies. My Board portfolio further spans the technology into telecommunication industries, government entities undertaking digital transformation and a not-for-profit in the disability services industry. I'm actively engaged across the market, remain current with regards to technology, innovations and challenges, which I bring with me to the Iress boardroom. We know we have work to do at Iress, and I look forward to having the opportunity, if reelected, to support, challenge and steer the organization to deliver on the significant opportunity for the business and results for our shareholders.

Thanks, Julie. Questions or comments from the floor?

Thank you, Julie. And clearly, we can see the wealth of experience that you bring to the Board of Iress and 35 years of experience both at executive level and that various parts right through, particularly in the technology sector. The question that comes to mind is what you are doing concurrently as other directorships or on other bodies. And I guess the question two is, do you have a percentage of time that you devote to Iress because we see other listed companies which you are nonexecutive director. I gather you manage your time extremely well, expertly in fact. So do you think you can give us a bit of a metrics of how you manage your time given the other directorships in you are and the Trobe University Board?

Julie?

Certainly. Thank you for the question. I think the first thing I would say is most people know that I'm incredibly structured, know how to prioritize incredibly well and have a lot of energy for this particular industry. And I think from my perspective, the busier that I am, the more I bring in terms of experience. And currency and technology is incredibly important. So there is a consistent theme, if you like, in terms of the companies that I get involved in. And to answer your question about the time I spend, it's entirely what's required. I clearly have the energy to be part of subcommittees, which I have quite a passion for and if anything could test somebody's ability to manage their time, it was the COVID experience, which really was a very important time for us to be -- every nonexecutive director to be very, very active in their companies. So I am very confident I have the capability and the capacity to manage what I have taken on. But I take my commitments incredibly seriously, and I continue to monitor that on an ongoing basis.

If I can add that Julie has been on the Board since 2017. And clearly, in that time, I've worked closely with her. And also, she's been Chair of the People and Remuneration Committee. And more recently, she chaired the Nominations Committee for the recruitment of the new Chair. So I have seen firsthand the dedication and the commitment she has to Iress, and I've been very confident that whenever asked and participating, there hasn't been -- I haven't been concerned that there wasn't enough time being devoted indeed. That being the case, I would have raised it, as you would expect. So I'd be very confident about that. Other comments or questions, Peter, online?

No, there are no questions online time, Tony.

Thank you. I'll now put the resolution. The resolution. The proxies -- I ask those voting in person or online, please now cast your vote, for against or abstain for resolution 3. And a reminder, again, that the resolution will remain open until I close the poll. [Voting]

That completes the reelection and election of directors. Thank you, everyone, and thank you for your questions and your comments. We now move to Resolution 4. And this, of course, is the remuneration report. And the resolution is that the remuneration report, which is contained in the director's report for the year ended December 31, 2020, be adopted. And that's now before you. As you know, this is an advisory resolution to adopt the remuneration report. The remuneration report is, of course, included in the company's annual report. And it explains the company's remuneration policy and its relationship we then linked to the company's performance, contains the remuneration details of the directors and other key management personnel, explains [Audio Gap] employees. As the shareholder vote on this resolution is advisory only, the outcome of a vote is not binding on the Board. However, if the company receives votes of 25% or more against the remuneration report at 2 successive AGMs, a resolution to call a spill meeting of the Board must be put to shareholders in the next AGM. Now as I said, all the [Audio Gap] report is contained in that report, I do want to assure -- reassure shareholders that under Iress remuneration framework where material concerns are identified over a performance period, the Board has a discretion to reduce or remove grants that may be awarded. The Board did not identify any such material concerns when assessing the 2020 performance. So the Board believes that [Audio Gap] grants are sound as detailed in that report. And Julie Fahey and I -- Julie, as Chair of the People and Performance Committee, and I are available to answer questions. And I'll open up questions and comments before we put the resolution first to the floor and then to online. So are there questions on this resolution, please?

[Audio Gap] the ASA requests that Iress consider reducing the CEO's fixed proportion of his salary and increasing the proportion that is at risk and performance-based and strengthening the hurdles for the CEO to receive his performance rights.

Is that both for equity rights and performance rights? The performance rights are the LTI. It's got the absolute TSR hurdle. And the equity rights, are you saying you want to reduce -- you're asking us to consider reducing fixed and increasing the amount -- consequently, that would increase the amount at risk and then have hurdles in...

Reducing the equity rights. And yes, strengthening [indiscernible] in the second half of the same [indiscernible]. I explained to your CEO, on our call, I'm not particularly passionate about this [indiscernible] on being overruled obviously [indiscernible].

Well, thank you for those comments. We'll take those on Board, Julie, in particular. Judgments about these things have to balance incentive and reward and performance. So there's -- the judgment that we've made to date, we feel is sound. But I think with all these things, there's always room to reexamine, have a look at them. So thank you for the comment. We'll take that on board. Other questions, comments? Thank you, Peter, online?

No, Tony, there are no questions online.

Thank you. The proxy resolution is there behind us. And clearly, there's an indication there with the for, against and abstain that the Board does need to look at these issues closer. And I'm sure that Roger and Julie will do that over the next 12 months. I now ask you to vote either for, against or abstain on Resolution 4. [Voting]

Thank you. As I say, the voting will remain open until I close. Okay, we now move to resolution 5. This is the grant of equity rights and performance rights to the Managing Director and CEO, Andrew Walsh. There are 2 resolutions here, 5a and 5b, which relate to the grant of what we're talking just a moment ago on equity rights and performance rights for the CEO in relation to his 2021 remuneration. Under -- just some overall comments on the 2 resolutions, and then I'll take -- I'll go to each resolution in turn. Under our framework, Andrew's remuneration includes, as we were speaking a moment ago, the base salary, the equity rights and the performance rights. And he's also required to accrue on hold Iress equity equivalent of 400% of his base salary by December 31, '23. So we do have a high proportion in equity and also require a retention holding in equity. What the company now proposes to grant equity rights and performance rights under the Iress equity participation plan to support our focus on sustainable long-term growth and to continue to align the executive interest with the interest of shareholders. Now -- so that's what we're seeking approval for. Now I'll turn to each resolution. The first one, 5a, is that he'd be granted 97,089 equity rights in the provision of ordinary shares under the Iress equity participation plan. And that would be the resolution that's approved. The equity rights constitute 33% of Andrew's total remuneration, and they have a 2-year vesting period, followed by a 2-year holding lock applying to those shares provided on the exercise of those rights. The Board, in proposing and supporting the resolution, considers that the incentive arrangements for Andrew, including his proposed grant of equity rights, are appropriate and in the best interest of the company. Now further information on that, of course, is in the remuneration report and in the Notice of Meeting. So I'll open it up -- that's the resolution, and I'll open it up to questions and comments first from the floor, and then I'll move to online. Are there questions and comments from the floor? Thank you. Peter?

Yes, Tony. There is a question online, again, from [ Mrs. Carey Margaret Bible ]. And the question is to anyone on the Board. As a long-term shareholder, I'm disappointed in the share price for many years. Give me a time frame when I can expect to see an improvement in the share price. When will all the initiatives flow through to a higher share price?

I'll take the question as a comment in the sense that I do get -- we do get the thrust of that comment. In terms of being able to give you a time frame, the company does put out update reports and the most recent, I think, February, and we do give quite detailed information about how we're tracking and how we're likely to track in the financial year. So I'd encourage to have a look at that. And in terms of time limits beyond that, it's very difficult for us to do that. But we are well aware of the nature of the comment, the thrust of the comment that the questioner is putting to us. If there no other questions, the proxies, we'll go to vote. I'll just stay with that for a moment. For, against and abstain, both those in person and online, so I ask you to vote, please. [Voting]

Okay. We now move to the second part of that resolution, which is 5b. That's to approve the grant of 102,863 performance rights to Andrew as part of his variable remuneration for 2021. Those performance rights constitute 35% of Andrew's total REM and will have a 3-year measurement period. Vesting will be based on the company's absolute TSR performance, which is outlined in the Notice of Meeting and remuneration report. Again, the Board considers that these incentive arrangements for Andrew are appropriate and supports the resolution be passed by shareholders. As I said, further information on the grant of those rights are set out in the Notice of Meeting and also in the remuneration report. I'll open that up to questions, in-person. Thank you. Online, Peter?

There are no questions, Tony.

Thank you. I ask that the proxies be shown. Please vote for, against or abstain in person or online. [Voting]

Okay. That brings us to an end of the voting and the discussion on the items of business. I'll now move to close the voting. Please ensure that you have cast your vote on all resolutions. I'll now just pause to allow time to finalize those votes. Staff from Computershare will collect any voting paper for those attending in person. All collected? Thank you. All collected. Thank you. And so that being the case, I will now also declare that the poll will be closed and the poll being closed now. Thank you. The results of the poll will be released in the usual way to the ASX later today and will be available in the Investors section of at the Iress website. Let me close by first thanking you for -- sure. Sorry.

Just one [indiscernible] old shareholder. I go back before John and Peter. So that's qualification. Geoff and John, thank you very much. You've always been available before and after me to discuss the company. And it's deeply appreciated. Tony as Chairman, I hope the elect man is listening. You've always been willing to have a little bit of banter. And it adds to the place a little bit, I hope. And you reprise the questions sometimes clearly, sometimes not, has always been with good grace, good humor and very good analysis. So thank you. And the 3 of you, on behalf of being a shareholder, thank you for your stewardship, and thank you for your contribution, and best wishes for good fortune.

Thank you. Thank you, [ Norman ]. That's deeply appreciate it at all levels, and I'm sure I speak for Geoff and John as well. So thank you very much. It remains for me to close the meeting to thank all of you for your attendance today. And again, to thank also our retiring directors. I think the message you've given us is clear and here, whether it be in the voting on the remuneration report and the other comments you've made is clear. There's no question at all that Roger and the new composition of the Board are well across that as is the management team. So I remain extremely confident, and I won't lose my emotion here in Iress going forward and to continue to be a shareholder. And I may be sitting there with you, Eric, it next year, you never know. So we can ask some questions together. So thank you to the Board and to management, and I wish you all well. And I won't be sort of going off into the sunset. I will be around. So thank you all, and that closes the meeting.