Kelly Partners Group Holdings Limited (KPG) Earnings Call Transcript & Summary

Well, good morning, everyone. We'll just give you a quick presentation and then take some questions. It's been a good year to be a council. The numbers we hope are really set out nice and clearly. I'll just move to Page 1. We have KPG in 10 seconds. And what we're trying to do with this slide is just give you everything you need to understand the business. We think it's important in a professional services business that revenue grows in order to provide opportunities for your people. And we're pleased that we've been able to, again, this year, grow our revenue strongly, which means strong opportunities for our people. And in a market that the talent is a challenge we're told. People are ultimately always going to be looking for opportunity in growth organizations. Margin is strong, remains very much stronger than the industry, and we're integrating a lot of businesses at the moment. So we will see that margin expand again soon. Parent NPATA is strong it's grown by 23%. Return on equity remains very strong. Gearing is very much under control. Cash flow is very strong, and the cash conversion, we're very pleased with. So we've broken the presentation into 4 parts: about KPG, financials, outlook and quality shareholders. I'm joined by our Chief Financial Officer, Kenneth Ko, will present on Section 2. I'll give you a quick overview about KPG and also comment that we updated our owners' manual with version 2 recently, and this presentation is best read together with that owners' manual. So a track record of the business since its inception in 2006 is that we've managed to double the business now 5 times in a row. We think that's very important because it speaks to the business system that is operating under business that has a proven track record of growth. We would like to say that, that sort of ideas relate to actions, actions relate to habits and habits relate to destiny. In this business, that has a good habit of growing and growing profitably. You'll see on the next page that per share growth continues to grow and accelerate. And we're very much focused on recurring revenue per share. Since last year, our owners' and earnings per share since IPO, both of which are compounding strongly, we know the market is enormous and that if we can continue do that, then that will stand the business in very good stead. Return on invested capital is our next metric, which we like to focus on because we think that it's a good measure of the behavior generally of the business. You can see that our ROIC plus organic revenue growth is very strong. On the next page, our friends taught us about owner earnings and here it is, it's the way we think about the business as a strong CAGR in owner earnings and you can see it growing year-to-year very strongly and so for all of you as partners and owners, I feel very pleased that we're managing the business in a sustainable long-term manner that will grow owner earnings over time. In terms of capital allocation, we're informed by William Thorndike amazing book called The Outsiders, which we love and resonates with our mindset of being sort of outside of people. And we're pleased that we've improved the earning power of our businesses about operating business. We've further increased our earnings through acquisitions this year, growing our existing accounting subsidiaries, growing our existing complementary businesses, making programmatic acquisitions and making an occasional large acquisition, which in the last 5 years, we haven't done and we don't expect to do any time soon. And we've purchased KPG shares over time, and we've held the number of shares on issue that reduced its since IPO, which is great. So the growth that's being achieved -- is being achieved on the same number of issued shares. Programmatic acquisition is our game. It's taken a while for people to understand that what we do. We've done over 50 small acquisitions we're going to continue to do there each transaction 55. We use our Partner-Owner-Driver model, and we do that over and over again, and we think that there's a huge opportunity just to keep doing that. That number will go up some years and down others. But what this graph seeks to show is that we've been doing it for a long time, and we expect to do a lot longer. On the next page, I've just emphasized that 5 years, we think is the appropriate period. We've always thought to judge our performance as a management team. This year's results of 5 years since IPO, we're pleased with the progress we've made. We're setting a plan for the next 5 years. And I think you'll be confident that over time, you've always out achieved whatever plans we might have shared publicly. We've done a summary on the next page of the performance of the business since IPO. We're very pleased to now consider that we've done sort of training wheels first 5 years as a listed company, and we get a little bit better at what we do. The group now has 436 team members across 20 and 31 operating businesses, spanning New South Wales, Victoria and in terms of global Hong Kong. Our ambitions are to continue to grow wherever we can find, people that share our values which are all about making our people and clients better off. We will grow as fast as we can find those people, but in a considered way, and we will not drop our standards with respect to how we treat our people, the work we produce for our clients or how we integrate businesses into our group. On the next page, you'll see that our people have rated us a great place to work, 90% of our people rated us in that way. Our people are owners, they're not just employees. They own a significant chunk of our business and they're sharing in the performance of the business and our team member satisfaction measured through our employee NPS score is very high. We are the only listed certified B Corp accounting firm in the world as well, which very much appeals to our people because it reflects their values as to one part of a cooperative business endeavor with a strong purpose to make our people, our clients and our communities much, much better off. In terms of services, our services are very focused, and you'll see an increasing focus of our accounting, tax audit, finance, insurance and wealth and estate office. Very pleased with how the clarity of our services to our clear private business owner clients are being refined and delivered in the market. And we think this depth and this focus makes an enormous difference. Today, there's 13,500 client groups, who have grown by 40% over the last 12 months. And you'll see there's a very strong NPS of 68 with over 700 responses today. Our revenue growth is very strong. You can see that we are experts in acquiring, sourcing, acquiring and integrating amazing businesses into the group, and I could not be more pleased with the quality of the businesses, the people that lead those business, those are in those businesses that are approaching us to join the group. We'll move as quickly as we can to bring the best people into the business, the right people, and we'll continue to do, as we've always done that in a very considered way. Our business is a branded offer. We haven't emphasized this as much as I will today, but through 101% of signage, fitout, digital onboarding process, et cetera, we are getting people to join our community, our tribe of account less who want a change to the status quo, a better way to do things to make sales to our people, the clients and communities better off. This has been consistent since our inception in '06. It's becoming more obvious as we grow, but there's really compounding effects the effort that we're putting into the brand against others in the industry. It's growing very, very strongly. That's particularly relevant when you try to bring great people into the business. Great people want to join a brand that stands for something that's consistently presented and consistently behaves and delivers in a way that aligns with their values, and that's certainly the case in our group. And I'm going to hand over to Kenneth Ko to take you through the financial section.

Thanks, Brett. Hi, everyone. I will go through the financial section now. And the first slide is the highlights slide. So Brett has covered a lot of these metrics in the previous slide, but this slide gives you a quick side-by-side with our prior year results. And we can see that in most of the metrics will be increased 20% to 30% from the prior year, which is pleasing. Some of the ratios here, I just want to point out, such as ROE, ROIC, cash conversion, et cetera, they're impacted by the NPATA acquisitions that were completed during the year. I'll leave you to go through this slide yourselves in your spare time as we'll cover a lot of these other metrics in the later slides. In terms of the metric since IPO, as Brett has gone through in the previous 5-year IPO slide, this gives you a lot more detail. Again, I'll leave you to look at spare time, but you can see that we're basically growing the business at a CAGR of in the mid-teens and basically doubled the business over the last 5 years since IPO. In terms of the income statement, our revenue grew at 32.6% to AUD 64.9 million through organic growth of 6.2% and acquired growth of 26.5%. We're pleased that both of these metrics have exceeded our Group's target growth of 5% organic and 5% acquired. Our EBITDA margin is slightly lower than what it was last year, and I'll explain that later on in the slide that better explains this. Our underlying NPATA attributable to our shareholders grew at 23.2% to AUD 6.3 million and is a very strong result. Other than this, I just want to point out a few items here on the income statement that's grown disproportionately to the revenue growth, which includes depreciation and amortization, which is mainly due to the fitout that we've done to the offices, the right-of-use assets that we've required as we have more offices open through acquisitions and more office leases and obviously, an increase in amortization expenses due to the increase in handful assets that we have acquired from the completed acquisitions this year. In terms of revenue growth, again, this shows us the organic and acquired growth since IPO throughout the years. We're pleased that the organic growth averaged 5.1% and that is consistent with our 5% target, and we have had strong acquired growth throughout the year, and it continues to be our focus to acquire quality accounting businesses. In terms of the underlying NPATA reconciliation, this slide gives the reconciliation of the reported NPAT to the underlying NPATA, which is the number that we measure ourselves against on. We have excluded any government grants that we'll receive from COVID as well as any subsidies that we received during the year. We've also excluded any direct non-recurring costs related to the 8 acquisitions that we've completed during the year. And this includes inheriting the various leases that we no longer occupy after we've completed acquisitions. For example, Sydney, Canberra, Penrith, Narrabeen, these acquisitions were all inherited leases or we've had overlapping leases and also we've excluded any one-off costs such as transition and migration costs in relation to the acquisition. This slide summarizes the key measures we see that drives the cash flow and profits of the business. Our lockup days is at our benchmark of 55 days. We're very pleased with this and given the number of acquisitions we've made throughout the year and some of these acquisitions has historical lockups of 150 to 200 days, and we're very pleased that we've been able to reduce a lot of these very quickly to our benchmark base. Note that here, obviously, the lockup was calculated based on the annualized revenues as that makes sense to do so. Our cash conversion is lower than previous years at 83.3%, and it's impacted by the first year accumulation of lockup. Now I've put 2 slides in the deck that explains this and we'll go through that as we approach those slides. Now in terms of the balance sheet. So lockup, as I said, continues to be managed tightly and is at our 55 days benchmark continues to be very strong. Our balance sheet, we've had increases in both our assets and liabilities due to the acquisitions included. So an increase in right-of-use assets because of the additional leases, increases of intangible assets and increasing borrowings. Our group and parent ROE, as Brett has covered off, continues to be very high, and it shows a return that we were able to generate with the minimum capital that we require. In terms of the profitability. So this slide explains the EBITDA margins. And this year, our EBITDA margin is at 30.9% of our operating businesses. Last year, it was 33%. And this explains the contributions of the EBITDA margins from the various cohorts. We can see that due to a couple of reasons. Obviously, the any acquisitions we make during the year, although you can see 30.3% for the first year is pretty amazing for the number of acquisitions we've done, but also due to the small number of growth in subscale businesses. And the definition of those are provided their growth is AUD 1 million, AUD 2 million subscale under AUD 1 billion. And these businesses are generating subscale EBITDA margins. The great thing though that I want to everyone to focus on is our established businesses, which account for 65% of our businesses continues to operate at 34.2%, which is excellent, and we continue to focus our efforts to scale up the subscale businesses and also improve the profitability of our acquired businesses. And regardless of the above, we continue to operate significantly above the industry average of 19%. In terms of gross margin, this year, our gross margin is impacted because of the higher cost of sales from our acquisitions, and we continue to aim for a gross profit margin of more than 60%. But again, we continue to operate significantly above our international peers, and we continue to focus on this because we believe it's a very important metric for long-run performance. In terms of cash flow, we summarize the cash flow here from our operations and the uses of those cash flows. Cash from operations has increased 10%, free cash to the business has increased at a lower rate, 5.6%. And this is because of the scheduled debt reduction increased because of the increased debt that was taken on to make the acquisitions. And you'll see that below all the items, all the financing and investing cash flows that we've used during the year. We've drawn AUD 20 million of debt. We've used 12.5% of that for acquisition, AUD 6.1 million of that for growth CapEx, which includes buying the Canberra property and various fitouts of the 6 offices we've done during the year, paid dividends, additional debt repayments, et cetera. So I'll leave that for everyone to go over themselves. On the next slide, these 2 slides are the ones that explains the acquisition impact on the cash conversions. And you can see here, I think I included this in the first year -- in the first half results presentation as well. In the first year, basically, there's an accumulation of Debtors and WIP and that creates basically a reduction in cash conversion, and that doesn't happen anymore in the second year. So in all the first year, acquisition, it always creates an impact on the cash conversion percentage. On the second slide here, I do reconciliation -- so basically -- if you basically add in the -- that first year accumulation of the lockup from the any acquisition, our cash conversion is actually at 98%, which is excellent. And you can see there the lockup from the any acquisition at 72.8% is excellent. As I said before, the historical lockups from a lot of these businesses that we acquire are at 150 to 200 in days. And being able to reduce it to that level is really great. And you can see the WIP bases at 17.5 days, which is within our metrics of 20 days. On debt and liquidity. Our net debt has increased significantly. But what I want to point out here is even though we borrowed AUD 21.2 million throughout the year for our acquisitions, for NPATA, et cetera, we've made principal repayments of AUD 7.5 million. And to us, it's not a concern at all because we're repaying these debts through our cash flows generated from the acquired businesses and generally we paid over a 4- to 5-year period. So we should see this come down very substantially over the 4- to 5-year period. And obviously, we continue to maintain a significant headwind on that. Our net debt per partner has obviously increased because of the increased debt. But we don't see this to be an issue. We are repaying the acquisition debt very quickly, and we should see this amount drop down over time. Parent and NCI, I'll leave everyone to look at. We always get asked, why doesn't the NPAT percentage align with our ownership percentage and it's basically because of tax and the additional investment we make in the parent entity, but I'll leave everyone to look at this in this base slide. In terms of dividends, we continue to pay monthly dividends. We have increased our monthly dividend by 10% since July -- actually July last month. And we have paid one final dividend that which we do pay on 5th of August. And we expect the total dividend paid for FY '22, including final and special dividends to be around AUD 7.98 per share, and it represents a 57% dividend payout ratio. In terms of cash reconciliation, again, I'll leave this to you to look at. This is a reconciliation of our reported NPAT and the cash from operating activities disclosed in the cash flow statement. You can see the non-cash movements, there is a huge amount there, $3.1 million, and that represents all the balance sheet movements that non-cash resulting from acquisitions, right, mainly employee liabilities that would carryover, et cetera. And you can see that, that actually offsets against that positive movement in trade and other payables and deferred tax assets. In terms of cash flow since IPO, as the businesses that focus on cash flow, our cash from operations have increased at a CAGR of 20.5% since IPO, and we've reduced our lockup base considerably, I think we started there in IPO at 94 days, and now it's at 55 days, which is excellent. In terms of first half, second half skews, excluding acquisitions and focusing on the accounting businesses, first half, second half seasonality is consistent with prior years at 53% for the first half and 47% -- to 48% for the second half. This year, including acquisitions, obviously, it skewed towards the second half as we've completed a lot of acquisitions towards the latter half of the year. And in terms of the issued shares, we just want to show -- have this slide to show you that we haven't issued any shares since IPO. And in fact, obviously, we bought back shares, and our shares at the moment are at 45 million, which makes it very easy for everyone to capital at the key measures such as EPS, et cetera. That's it from me, Brett, his outlook. Thanks.

Terrific. Thank you, Kenny. And just before I move to the outlook section, there were a couple of questions that have been on flagged in, one was, what is your estimate of KPG share price currently? I like that one. I say that the intrinsic value that we focus on of the business is best calculated using [indiscernible] dividend discount model that you can find in the back of Warren Buffett Way and make 2 assumptions, one around expected future growth and the second around appropriate discount value other ways to use since inception of the U.S. 30-year. Treasury rate because that's what Mr. Buffett itself used. And we are determined not to be involved in businesses that present any risk to us. We think that with our deep expertise and accounting present the lowest level of risk that we can evolve ourselves in. Second question was, do you see rising interest rates affecting the company's ability to make further acquisitions. I've answered there, no, the first firm that was acquired by the group was acquired with interest rates of 11.1%, I remember, paying those rates. So we don't see interest rate increases in any impact on make acquisitions. So I'll do outlook, what are we saying about the outlook? Well, the 2 big learnings that I've shared before in the last 12 months is meeting Lawrence Cunningham moves now on our Board and confirming through his involvement because installation software and subsequent introductions that is made for me with executives of that business that we should keep making many small deals in the domain within which we're experts and that we should look to win in Australia and then look to find ways to take our model to be used by anyone who share our values and wants to make a difference to their people, clients and communities. Second one was Will Thorndike. He's booked The Outsiders, as where he purchase and said, look, he could see that have this flywheel turning and so for us, it has been our focus. Everyone has ever joined the business has been given good degree to read the book by Jim Collins, which talks about 6 steps to breakthrough performance and building a flywheel. So we -- I'd love to -- I guess it's always good to meet fellow travelers, who get you to continue to focus on the things that make us. In terms of the 5-year plan that we published 3 years ago, we expect that we are on track in terms of revenue run rate to do AUD 80 million in revenues this year. And so our numbers should look something like that, which is great. I would emphasize that knowing that we've got that AUD 80 million takeaway in our view. We will look to continue to accelerate our growth and to invest in our platform to allow, to achieve our next set of goals, which is very, very exciting. In terms of the management bench, I've been quietly building out management bench. We have senior leaders now across people, operations, client experience, finance, IT and digital as well as legal and risk. I feel very confident that our senior executive team is in place to take this business to at least twice its current size, which is very exciting. In terms of management alignment, we'll do that through an LTI program that will be based on Macquarie Bank and Constellation do, where we'll look for doubling of business, cash-based performance, no options and maintaining our share count of 45 million or less. There will be no any out of share options at Kelly Partners on a confirmed basis. In terms of our next 5 years, we're naming a clear set of objectives, and that is to senior accounting group as one of the top 10 largest firms in Australia, and that would mean we'd need revenues in excess of $120 million, across the scope of accounting, tax audit, business advisory, finance, insurance and wealth, what we call complementary services in the state office. And then we believe that we can do that because of our business model, our Partner-Owner-Driver and our Central Progress Team that are very unique. And I'd say, regional ways of doing business in a market that are insurgent in their mindset and having a real effect and a compoundingly positive effect. Our second objective is to scale our complementary services by either building, buying or partnering. We've partnered in the insurance space at Austbrokers. We're considering how to substantially grow finance and wealth. I've set the target of those 3 businesses that if we are not within 10 years, businesses in those spaces that can do AUD 4 million minimum NPAT, which is last year's NPAT of KPG, and then we would not be keen on being in those areas. So we intend to discover what we call a natural conversion rate of financing, insurance and wealth services required by our clients. And that's really important. It's what is natural. What do the clients want, what do they need, what do they asked for. There'll be no cross-selling at Kelly Partners and no sense that the business is about selling things to clients that they haven't asked for. And the final objective is, we want to see the business go global. You can see that by bringing lines coming on to our board by building out a global shareholder base, we are looking and being encouraged to explore how do we take this system that we built and have other peoples share our venues deploy that system. We think that the obvious markets of New Zealand, the U.K., Canada and the U.S. represent an expansion of our total addressable market of nearly 20x. We very quietly sort of kept these aspirations internally to date. But I think it's time that we share with you guys as investors that the investment that we're making to build this business has been very substantial, and we just believe that we can grow with our clients into the markets that we see as their future. So we see Australian businesses are staying quite longer and looking to export and grow into the U.S. and U.K. in particular. I'd just love to share these 4 models that we've built. It's our business model at the group level, our business model and our operating level, our Partner-Owner-Driver structure and our Central Progress Team. These are 4 very unique ways of thinking that have been developed into ways of doing and have been practiced now for a long time. Ever since we started Kelly Partners, we've never owned a firm 100%. We've always done a 51%-49% staff structure. So that it is a genuine partnership with genuine owners who are driving that business with us together. Our business with partnerships, we think is very, very unique in our industry, certainly, and the Central Progress Team that gives us a team of experts working on the important path of our partner firms, just delivers the building of the mode, building of competitive advantage in each of those areas. We're particularly excited about what that means for the business. Our final section that we've got quality shareholders, I'd just direct you to read the owner's manual version 2. If you haven't read that, I think you'll find it sharpened up even more focused. The first person was to answer a lot of the questions that we've been giving us over time. This is an even more focused document, which we think will help. We want -- on Page 49, you'll see that we've built out a global shareholder base. And our shareholders now are all over the world. We've got an incredible group of shareholders. And I was very pleased recently that we were able to see the last -- on the back of the last shareholder that has sort of ended up in our register by accident and replaced by really, really focused quality shareholders. Finally, I'd like to just draw your attention to our expanded Board. That's now myself, Stephen Rouvray, Ryan Macnamee, Lawrence Cunningham is independent directors, non-executive directors and Paul and Ada, together with me as people with the operating experience in our industry. So I think that you can see that there's a reason for everything that's going on within the group, and I hope that fills me with confidence as to where we see the future.

I'll just answer some of the questions that I can see on the Q&A chat, which is always the most interesting part. So when reviewing potential acquisitions had a discerned between a firm that is operating sub-optimally but can be improved up to KPG standards in the system versus one operating suboptimal that you conclude won't improve enough? Very good question from Brett Dorendorf. Brett. First, if people don't have the values that things can improve then -- and they don't have the values to actually want to go on the long march to actually make the difference to make the efforts and make the investment. It's really about the attitude and energy of the ownership group. Are they people that really want to make a change to make things better or not. We do an enormous amount of analysis so that we can see whether the client base itself would be receptive. We look at the reputation of the business in the market, the strength of its brand, et cetera. There's an enormous amount we do. But fundamentally, leadership is critical in all businesses and in all spheres of life. And so if the leadership group, they actually don't believe things can be better, and they don't believe that by partnering with us, we can substantially improve the business, then that would be the reason that we wouldn't play overwhelmingly. From Trevor, look, do you see -- how do you think about the impact of rising interest rates and the growing net debt? Do you expect to keep borrowing at this rate going forward? It's a great question. We don't really hear interest rates Trevor, as I mentioned in an earlier question. I started the group, I was borrowing at 11.1%. I was always confident that if we're making 35% EBITDA, that interest rates would have little to no impact on the business. So in the short-term, we might pay a little bit more interest. But in the long-term, we'll be the owner of absolutely tremendous businesses that are enormously advantaged in the markets within which they operate. So it depends. If you're here for a short time, then you might be worried about that. If you're here as I intend to be for a very long time over the cycle, I'm not concerned at all about interest rates. We also paid AUD 7.5 million of principal back last year. So the actual level of net debt. If you take a level of net debt and take AUD 7.5 million plus the increase that will pay back in principal this year, we've always aggressively paid down the debt of the businesses we acquire. And in fact, we typically expect to pay down 100% of our share as the debt of that business before we draw dividends to get paid out to the shareholders. And so our approach to debt has always been to be happy to take it on to buy a great business. But to be even happy to pay it off very, very aggressively, we are paying in those acquisitions, 100% of our cash flows, profits from those businesses, less tax against the debt. Fiona, presenting great results, nice to be able on the RASK podcast, it was great. Thanks, Fiona to be asked by them to share that information. Just wondering why there is one office in Hong Kong here the business otherwise largely cite-based? It's a great question, Fiona. Ken has been up in Hong Kong for 6 years. I'll share the story. It came to me with tears in his eyes and said, I like working in Kelly Partner, Brett, but my mom wants been back in Hong Kong. They've been educated here in Sydney, and I said, Ken, call your mom, tell her she can have you tomorrow once you've opened an office to Kelly Partners. The reason I like to share that story is our business has always been talent led. And so if you've got talented people in your business and they want to open an office on Mars and you can make it work, then that's been our mindset. But I will give you another comment there, Fiona. I always believe that by locating Ken and his finance team in Hong Kong, we would start to learn how to work remotely and have a much more global view of the opportunity in the business. We've now got 10 people in that office. And it's worked really well, and it's acclimatized our group to being able to work cross-border. [ Viyani ] inflation, how well are you able to increase prices along cost of inflation? It's a very good question, [ Viyani ]. We've always thought that we should grow at minimum 5% a year organically, 3% price increase, 2% volume increase. We can probably get 5% of the inflation and Australia is running at 6%. We've done 6.7% organic growth. So I'm trying to grow organically faster than inflation as a group, and we're pretty confident that we can do that. And we're very confident. Now if we get inflation of 20%, well, let's have another special call about that, but I'm not anticipating that although I don't view inflation is transitory. Edward Wellesley, 2 questions. Are the EBITDA margins achieve your growth in subscale acquisitions within expectations? And how soon would you expect these to rise towards your margin? And then Ko, you said, your EBITDA margin target was 37.5% is now appears to lower slightly to 35% series, this was the previous to take so optimistic. So I'll deal with question one. And we often buy firms to get into a location, even if they're subscale, knowing that we can add to them. So in each of those instances, ones in the Southern Highlands, for example, in Sydney, where we believe we can continue to grow that space appreciably. One is in the Blue Mountains where we've got a large firm now that's joined us in Penrith from South Penrith. Business is large as we sort of look at that business across regions. They may, in the future, come together. And so we expect that we're pretty patient, happy to be in a location do whatever margin makes sense and grow that business on a portfolio basis that really makes little to no impact. And our EBITDA margin has always been 37.5%. We typically share that it's 35%. When you look at our base model for an operating business, it's 37.5%, it's not too optimistic at all. If you do, I think we've done AUD 21 million of acquisitions on AUD 64 million run rate. So if you grow 30%-plus via our acquisition, in a given year, you'll see a little bit of short-term margin compression, but we can see the numbers. We don't -- we're not challenged by that at all. You'll see that come back to where we would like it and we're aggressive about it. So that will happen quickly. Sebastian Campbell. Great year, KPG, I see that your acquisitions, moving on somebody move there -- that your acquisitions have been increasing since '19. Do you believe the opportunities presenting themselves are increasing? Sebastian, yes, the opportunities coming to us are increasing. We're still being as selective as ever. But you can see we've bought 3 groups of approximately AUD 5 million in revenue each in over the last 12 months, absolutely superb business, and we're very humbled that they have approached us and entrusted us with their babies, with their business to join us. We expect that our branded offer, the quality of the activities of all of our businesses and the progress that we're making is likely to be very attractive to firms that really want to do business at the highest level. Ricardo Gonzalez, as you gain trust of international shareholders. Are there plans to add OTC? We interestingly, Ricardo, options are the purchasing shares or reinvesting dividends can be done at a cheaper price. The answer to that is probably, yes. I think it's about AUD 20,000. We've been pretty busy. We'll ask the lawyers because we've been asked by a number of people could we add OTC options for U.S. shareholders. So we'll get back on to that, and we'll do that for you. What is the repayment profile of that question from Sameer. Sameer, we've got 8-year debt typically on a practice, we'll pay ours back our KPG share back within 4 years. We're very aggressive and do that as quickly as possible. To your question about average life of the debt, if you go back and recreate, look at -- we're a public company, look at the last 5 years' accounts and the principal we're repaying and look at the acquisitions we're making, you'll be able to work that out. Andrew [ Ig ], people can change over time how those KPG had values -- no longer share the same values the KPG does? That's a good question, Andrew. We work strongly to keep our group together focused on the right values, which are very clearly acting in other's interest, doing what you say and with his as part of the team. We've proven, I think, that we've held the partnerships together for a long time and grown them. If there's a partner who doesn't share those values is revealed by their behavior, then we typically seek to deploy them to our competitors. Kieran Robertson. Amazing results well done to all the team. We've already touched on it, but you've taken on AUD 21 million of debt this year for the acquisitions. And yet, while paying it down really quickly, would it not be more rational to retain all earnings to fund the acquisitions instead of paying a dividend? Yes, it's a great question, Kieran. We're often asked. Would it be more rational? We don't think that at this point. I wanted to demonstrate as the listed company. And I think I've been proven to be prescient in this respect. I had, had the view over the last decade that there are a lot of companies that spend a lot of hoar, but don't pay out on a partnership basis, their profits to their investors. With that debt, 74%, it's very difficult to justify not taking on the debt and sharing the repayments or sharing the dividends with our investors. Our partners take dividends every month in cash. Now our view is that gives the investor the option to simply repurpose those dividends into further KPG shares or do other things with them. In the future, if we can get a structure that I think is appropriate, then we might at one point, become like Berkshire Hathaway and not pay dividends. But I would make very clear to the market and our shareholders, who are our partners that we can pay a monthly dividend fully franked in cash because this is a superb business, I think, very, very well managed. Andrew [ Ig ] has asked the questions, our filings indicate that Westpac has been our bank since I started, is there financing risk with any particular bank? Andrew, all of the big 4 banks and many, many others have approached me for many, many years, asked us to do business with them. We see no challenge with raising debt to fund our acquisitions. But should that challenge occur, then we would -- as we've always done, find ways to solve that problem. Andrew [indiscernible] difficult times to have a policy regarding Directors' owning shares in terms of minimum holding or loans? So great question, Andy. No, we don't. But we're pleased with our -- if you look at the filings, our Directors' do hold a lot of shares. And no, we don't have a minimum holding. And no, we don't give anyone a loan to ever buy our shares. We like them to do that. Vincent [indiscernible]. I like the gross margin point, very interesting this, I mean, working out a hedge -- the financial measures always been gross profit at the operating business level. And can KPG be a 100 bag alone. We've shared the 100 bag of book because we think its principles are excellent. And I think one of the principles of that book I've been asked us a lot is that, would it be bad if KPG was a 5 bagger, 10 bagger, 20 bagger, 50 Bagger, 75 bagger or 100 bagger. My focus is for us to build a 100-year amazingly high-quality business that makes a difference to people -- our people, our clients and our communities. And I think if we do that, it's quite likely that the business will do well. And as a shareholder, you'll do pretty well. Final question exactly. Do you know if any of your office service mining fossil fuel exploration companies? Are there any restrictions in place? It's a good question, Zack. No, I'm not aware that we have -- first, we don't have any significant exposure to clients in particularly anyway. But I'm not aware that we have any particular exposure to those industries. That said, we haven't sort of gone out of our way. It's not our history to find that type of business. It's not typically where our expertise has been. I hope that helps those questions. We're going to about another 4 minutes if anyone's got any further questions, but I'd like to thank everybody for the faith that they've shown in the company and their support of the business. And I'd encourage to the shareholders, if you can find clients to refer to the firms, please do, if you can find talented accountants that want to join what we think as good an accounting firm as exists anywhere in the world, that services private clients, and please send them our way. I want to thank our teams right across all of our offices and certainly, in our services team, Kenneth Ko, our CFO; Joyce Au, our General Counsel and our whole senior executive team. It's been another great year. We are pushing ourselves to find ways to innovate. I'm excited about the investments we're making for the future. And as always, the first 5 years as a listed company, I think we have been a good warm up to what we think is possible. And now we've sort of limbered up and we know what we're doing to a much greater extent than we did when we listed. I think that will be very helpful for the future prospects of the business. So as I always like to say, if there's no other questions. Have a great day.