M.P. Evans Group PLC (MPE.L) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and welcome to the M.P. Evans Group PLC Interim Results Investor Presentation. [Operator Instructions] Before we begin, I'd like to submit the following poll. And I'd like to now hand you over to Executive Chairman, Peter Hadsley-Chaplin; Finance Director, Matthew Coulson; and Executive Director, Chandra Sekaran. Thank you.

Thank you very much, Alessandro, and welcome to all of you. Thank you so much for attending today's event. I've had a little sneak look at the attendees, and it's good to see quite a few familiar faces. So thank you to all of you and we look forward to being in touch with you soon. And thank you to any -- people who are new to M.P. Evans, who want to learn more about us. This is essentially focused on our results, but we'll give you a little bit of a broader introduction to the company and to what we do as well. And you've been introduced to us, the executive team. I would just like to -- a number of you know Tristan, who was with us for -- Tristan Price, who was with us for 15 years, who decided around the middle of this year to move on to new career opportunities, but who was CEO for the last five years of his time with us and played a very important and central and key role. And amongst his many, many attributes, he was always very passionate about sustainability, and it's something that we too feel passionate about. But we all wish Tristan very well in his future career path. For the moment, I am managing as Executive Chairman those responsibilities previously managed by Tristan, and any announcements on a replacement CEO will be made in due course. But I am very ably supported by my colleagues, Matthew, Finance Director, and indeed, Chandra. And I'm delighted that he has been appointed to the board and he has already proved extraordinarily valuable in terms of the contributions that he has been made direct to the board in two of the board meetings we've held recently. So welcome to Chandra. I hope you all have the opportunity to ask Chandra perhaps some specific sort of more on the ground operational type questions. So let's make a start with our presentation. Just to give you a broad view of who we are, we've been around was almost 150 years. We're a U.K. AIM-listed company. But in recent years, the focus has been increasingly and now more or less exclusively on sustainable Indonesian palm oil. We have almost 52,000 hectares of either our own Group-owned areas or areas which are managed by us on behalf of the so-called scheme smallholders. This is a cooperative farmer units which were attached to our new projects where we develop their plantations to the same, exactly the same high standards as our own. But we've taken that fruit and process that fruit through our mills, and there is a mutual benefit there. We are growing and growing, and we are now proud to say we have more than 10,000 employees in the Group, seven of us in Tunbridge Wells and the rest in Indonesia. And then of course, not only the employees, but their families as well. So we have many people, if you like, dependent on us and we take our responsibility very seriously. We've invested over $0.5 billion into the Indonesian palm oil -- sustainable palm oil plantation sector in the last 15 years or so since we decided to sell our small Malaysian plantations and go for it in terms of significant expansion into sustainable Indonesian palm oil. Just looking at the map, you'll see the various red dots. This is good in the term our plantations are generally of a good size or economic unit, but were the -- a mill to serve those economic units. There's just one plantation up in the northern part of Sumatra, which is too small to have its own mill, but ideally that's up at Simpang Kiri estate, which is only about 2,500 hectares, but we would like to add more land. If we can secure more land around it, we will then be able to build what will be our seventh mill. We've built -- we've got five mills up and running already. We have a sixth mill due to go up by the end of next year 2022 down in Musi Rawas, which is the southwest part of Sumatra Island, and then we'll talk about further expansion that we're planning in due course. We also have remnants of our Bertam -- sorry, our Malaysia estate ventures, which has now become all about property development, and we are in the course of selling the small piece of land into Bertam Estate into Bertam Properties. This is a joint venture company which we've owned for 25 years, which has developed a new town. So we by default in a sense in Malaysia become property developers. And that sale of the last piece of land into Bertam Properties is likely to go through in later in this year. And then ultimately, we will sell out of Malaysia altogether. That sale value has a total value of about US$24 million. Moving to the next slide, this is just to give you a broad overview of what I have to say were rather good results. We -- I mean in the sense it was no surprise that we were able to achieve the crops that we achieved and indeed the CPO production because the crop growth is on an upward trajectory that we fully expect and it's in line with expectation. What was a nice -- very nice bonus was the strong palm oil market. So the results, the earnings that you see below are the very substantial increase in earnings, are essentially a function of the higher crops and the higher price, which we'll talk more about that. We'll also talk about the sustainability premier, perhaps Matthew, you might talk a little bit about that and what exactly is a sustainability premium, which somebody has already asked us. We'll talk more about the results in due course. So we'll move on to the next. We thought we'll just reaffirm what our core values are. What our core strategic objectives are. These aren't just buzzwords. They are -- each one has a specific meaning for us. I mean in terms of responsibility, this comes in many forms. That's the first of our core pillars. We are extremely responsible in our approach to the environment. We've been active members to the RSPO, almost since its inception in the early 2000s. We absolutely do not deforest. We have a policy of zero waste. We produce organic compost from the empty fruit bunches, which reduces the amount of inorganic fertilizer that we need to buy. We produce green energy. We take the -- we capture the methane and we scrub it, turn it into electricity, which serves all our needs on our various estates where we have the biogas plants, and there will be more to come. So it serves our need in terms of electricity requirements on the estates and more. We're able to sell surplus electricity into the grid. And that accounted, in addition to our other sustainability premium of just under $2 million, a further $0.5 million or so by way of electricity sales. And then there's, if you like, the saving what we would have had to spend on electricity had we not being able to produce our own green energy. Our theme of responsibility ties in very closely with that of excellence. We're delighted to have Chandra on board with us since he joined in 2008. And Chandra's approach to agronomic management is absolutely one of excellence, and that culture is instilled from the top right down to the harvesters and to the leaders on the ground. So this is something which very much ties in with our strategic values. We are investing not only in the assets and sales and the plantations and the mills, but also in the people that work for us in a responsible way. We provide them with not only with good housing, but also leisure facilities and also schooling, particularly on the newer more remote plantations which don't have good schools, and that's an added incentive, a magnet to attract good quality managers who might be able to little bit wary or leery of actually going to a more remote project, but they know there is good education there on their doorstep, that serves as a magnet to induce them to go and work for us there. The excellence -- the excellent quality of our economic practices links in with the theme of growth, and the growth comes from essentially three sources. Our crop volumes and our CPO production will grow by virtue of the fact that our palms are young and they will be growing and they will produce more fruit and there will be more CPO. If we don't plant a single further palm, our production will grow significantly over the next number of years to come. It will also grow because of the continuing good, better, excellent practices that we instill, getting the maximum from every single palm that is in the ground. And finally, it's something we perhaps slightly underplayed in the past is our ambition, and we believe a realistic ambition to acquire, to secure new areas in the first instance around our existing projects where we have mills to make better use of our existing and excess mill capacity. Rather than buying in a significant amount of independent small order fruit, we'd like to exchange that, if you like, although that is profitable for a significantly more profitable activity of growing more of our own crops from newly purchased areas, and Chandra will talk more about this and the opportunities for growth first around our existing projects. But ultimately, as we look further ahead, perhaps the next three to five years, more of the sorts of 10,000 hectare projects that we've acquired back in the more recent past in the 2017, the Bumi Mas purchase or before that the Musi Rawas purchase. One was an old, but actually that's a newly planted palm oil estate that's Bumi Mas. The other, Musi Rawas is a very old smallholder rubber project. In each case we hope to rehabilitate or improve those projects to bring them up to excellent standard. And finally, the fourth pillar as it were is that of the yield, and in this instance I mean dividend yield, giving an increasingly better yield, better return to our shareholders on the back of our increasingly higher growth and better and better results. This is just really a little bit more on that subject, an example of one of our schools at the top-left. Top-right, an example of, on Bumi Mas, the quality of our new housing, the quality of our new planting, the quality of the roads we put in. It also serves to make better and better yields, better and better results from what we have, making the most in the best of what we actually own. The example of the growth, historic growth as shown on the bottom left box. This is where we have come from in the last 10 years. It shows a combination of growth from our own production, from that of our own scheme smallholders, and that processed in our mills from our so-called the independent smallholders whose fruit we buy-in from outside. And then historically, this shows the yield, the dividends that we've paid. It's unusual for particularly an AIM company to have been able to maintain -- only to maintain or increase dividends over a 10 year span. In fact, we've achieved this over more than 25 years. And even more so, for commodities-based company whose income relies really exclusively now on the revenue from palm oil, but yet because of our substantially increasing crops that helps to mitigate against the effects of any decreases in the price. And we feel confident about being able to continue to deliver higher and higher dividends as we grow more and more. Just on the palm oil market itself, I mean this was extremely strong by historic standards. We saw the cif Rotterdam price increased by 72%, at times well over $1,200 a tonne. I think the historic high is around $1,400, which obviously was very good news. Not such good news was the fact that in December 2020, the Indonesian Government introduced an additional export tax over that already imposed. It was quite a swinging additional tax, which was done in order to help to subsidize the producers in Indonesia of biofuel, biodiesel because the engineers and governments have the ambition to have more and more biofuel as part of the mix in their diesel production. Nonetheless, we were still able to achieve an increase of 34% in the actual price, the bottom line price that we received, averaging $724 per tonne for the first half of the year. The reasons for the strong market were partly because vegetable oil stocks generally were low and because production was down in terms of the vegetable market as a whole, the Americas, both North and South America experienced, sadly for them, weather issues affecting the soybean crops there, which has affected production and soybean, soya oil is the second biggest vegetable after palm oil. But also, specific to palm oil, Malaysia, which is the second biggest producer of palm oil after Indonesia, the two countries between them account for almost 85% of the world's palm oil production. So Malaysia experienced very serious difficulties and problems related to labor. They are almost wholly dependent on immigrant labor. And due to the pandemic, sadly, they were -- much of this labor was no longer available, and therefore, they couldn't get in and harvest, they couldn't get in and spread fertilizer. And even if they get up and running again, the fact that they haven't distributed fertilizer will mean that they're likely not to be able to return to former levels for some time to come. Indonesia did not experience the same difficulties because they have a population 10 times the size and they're not reliant on immigrant labor. Following the end of the period, palm oil prices have remained strong. The forward market shows prices remain strong through to the end of this year and indeed beyond. There is some sign, a bit of softening as we go into next year, but by historical standards, still a lot of strength evident. Now at this point, I'd like to hand over to Chandra to talk about the operations and initially about the impact or otherwise of COVID on our operations.

Thank you, Peter. COVID as you know has -- there is an existing pandemic, as you all know, and Indonesia was considered as the epicenter of the Delta variant after India three months ago. Today, numbers have decreased drastically as I speak. Yesterday there was 3,786 cases the whole of Indonesia that was reported and 276 cases of death. Speaking about M.P. Evans or P.T. Evans in Indonesia, for the last 24 months, we had 387 cases and no deaths. As I speak today, we have 38 infected cases all in isolation. The Group remains very vigilant in monitoring the situation very carefully. We are very sensitive about this. All estates and mills over the last two years, 24 months during the pandemic have continued to operate without any interruption at all. Where necessary, especially in the Jakarta main office, head office, remote working is in place for mainly administrative functions, especially senior staff continued to travel within Indonesia as part of the normal operational management and support. Vaccination rates have been -- are increasing over 40% of the Group's workforce having received at least one vaccination. As you know, we are very dependent on the Indonesian Government on availability of vaccines, but I'm very confident, in the last quarter, we can achieve at least 60% to 70% double dose vaccination. Next please. This is on crop growth. The bar charts that you see reflects on crop as at June 2021 and 2020. The green bar, the last green bar, the very right, shows total crop processed. What is total crop processed made out of? It's old crops, scheme crops, smallholder crops. These are schemes, plasma schemes or [indiscernible] schemes as they are called that we develop for the villagers who gave up their land to let us develop the land into plantation. These are scheme smallholders. We develop it and we manage it for them, and then we have independent smallholder crops. These are crops that basically sourced from outside farmers. We purchase this to improve the mill utilization. So as at June this year, we processed a total of 702,300 tonnes compared to 549,600 tonnes. Why is this so? This is mainly because of our average age of palms has increased and we are going into the prime stage of our growth -- of our palm. So if we breakdown, in our own crops, we also produced 413,000 as at June 2021 compared to 334,100 as at June 2020. You will see that there is a surge of our own crop, mainly because of age of palm. Scheme smallholders also showed a bigger increase of 43%. Independent smallholders, we started buying aggressively smallholder crops because in 2020 and 2021 we increased our milling capacity. We had two mills in the Kota Bangun project and one in the new Bumi Mas project. So we had two new 60 tonne mills in operations, and this made us concentrate also on independent smallholder crop. Next slide please. This is a very important graph which shows our increased milling capacity. The linear graph, the linear line shows our milling capacity increase over the years. You will notice that from 2020 to 2021, there is an upward trend. This is where two more mills came into operation. The bar charts show our growth in our own crop, smallholder crop and also the purchase of outside crop that is reflected by the orange bar. CPO production in the first half was 161,400 tonnes in comparison to the first half 2020 where we processed only 124,800. Production cost is lowest when milling our own crop in Group mills. Production costs from our own crop was US$335 per tonne. That is the cost of producing 1 tonne of oil, 1 tonne of CPO, and this is basically from our own crop. But total production cost in Group mills was US$437 per tonne. This is because, this is -- the crop that we buy from smallholders as well as from the farmers, we pay the extra amount which is related to the CPO price of the market. Nevertheless, the margins are still very, very attractive. As I said earlier, there were two mills that were commissioned in 2020 and 2021 in Kalimantan and the Group's sixth mill will be underway in Musi Rawas. Work has started on land-filling and the tender process is ongoing. We hope to complete this mill in 2022 end. The margin increases as more of our own crop is milled in our own mills. We hope in the end of 2022, 96% of our own crop will be processed by -- when our sixth mill opens in Musi Rawas. We continue to invest in planting. Planting has restarted in Musi Rawas. Why I say restarted, because the Roundtable Sustainability Palm Oil Organization had put even more stringent loss towards deforestation carbon stock, et cetera. So we had already planted 8,000 hectares in Musi Rawas prior to this. And when the rules were implemented, we had to submit all our documents and it had to be verified by RSPO. So we just received the green light in July to carry on. And we expect to plant at least 10,000 hectares in Musi Rawas. And as I said many times before, the sixth mill in Musi Rawas we will prioritize in 2022. The Group continues to invest in biogas plants, bulking facilities, infrastructure and regional offices to support the growth. The Group is also looking at acquisition opportunities for sustainable new land around existing estates. Basically, we are concentrating our growth around our existing estates for the time being, for the short-term. Number one, this is to maximize our milling capacity. We also like a very measured growth as we got to have a very good management team to lead the next large project. So this has to be done very carefully and very thoughtfully. Matthew, you can carry on.

Thank you very much, Chandra. If we turn now and just spend a little bit of time talking about the results and sales for the year -- for the first half of 2021. And it's great to be able to share them with you, and I think you'll see very clearly from this slide there. The team has increased and dramatic increase of that. If we saw revenue for the first half of this year that was up by 69%, so up to $128 million for the first half of this year. And as I'm sure some of you will have heard me refer to before, determining our revenue is really a very straightforward exercise. It takes looking at our CPO production and our mill gate price and multiplying the two together. It's been more complicated than that. You've heard about both of those two factors already as part of our discussion today. So Chandra was telling you about CPO production, how that's up 261,000 tonnes in the first half of this year, up by 29%. Peter was talking about prices, the headline price. CPO has jumped by 72% in first half of this year, but how we've still seen a very big increase, a 34% increase in our mill gate pricing for the oil that we sell to $724 per tonne on average. And it's simply taking those two together, we get a big increase to $128 million of revenue in the first half. Peter referenced sustainability premium as well. And because of the accreditation and the certification that we have at a number of our mills, we are able to sell a significant part of our output. The certified sustainable oil at the moment is just over half of our oil that we're able to sell, 54% of our oil that we're able to sell as a certified sustainable oil. And because we're able to sell it with that certification attached, we're able to obtain an extra premium for the oil that we sell and a small extra on top of the headline price for the oil that we sell. It's not a huge amount, but it makes a difference, and importantly, it's increasing as well. So you can see that the sustainability premium income more than doubled in the first half of this year, which we are pleased to report to you. So just under $2 million of income from sustainability premiums that we were able to secure in the first half of this year. Then looking at our profitability. So you can see a big increase in gross margin in the first half of this year, up from 12% in the first half of 2020 to 33% in the first half of 2021. Now of course, a big part of that is because of the increase we saw in pricing, but that's not the whole story. We continue to be very focused on controlling our costs. And the output of that focus is that production costs fell in the first half of this year, and that's measuring production cost for our own fruit going through our own mills, that's at the core of our business, our own fruit being processed in our own milling facilities. And you can see that was down significantly to $335 per tonne in the first half of this year. Chandra also referenced the $437 per tonne, which is our total cost of production in our own mills when you blend everything together. So our own fruit and purchased fruit going through our mills that comes out to that $437 figure and that is a little bit up on the previous period. But as Chandra also mentioned, that's a reflection of the fact that the price we pay for buying in fruit is indeed pegged to the CPO price itself. So you would expect to see that increase a little bit as CPO prices are higher. So we understand why that's gone up a little bit. But overall, of course, we're making a larger profit. So we are okay with that. Moving then, we see how all of this feeds its way through the income statement to the bottom line and how we have that big jump this year compared to last year in earnings per share. So where in the first half of 2020 earnings per share which is under 6p, 5.7. So earnings per share in the first half of this year was 38.3p, a significant change, and of course that very much supports the plan we have to be focused on increasing returns to our shareholders. Moving on then and looking at cash balance sheet measures. Very important to note that we continue to be very cash generative and our cash generation is increasing substantially. So where in the first half of last year our operating cash generation was just over $11 million, that's almost tripled in the first half of this year to $33 million, and that's measuring operating cash before interest and tax payments, which is a consistent measure. That's the measure we always report in these presentations. And what do we mean using our cash for, but of course, we've been using it to continue our capital investment program. $15.1 million deployed towards capital investment in the first half of this year. A big part of that towards completing mill number 5, which was opened just after the end of the first half of this year. Mill number 5 opened at our Bumi Mas estate, commissioned in August of this year. And then important to note that a significant amount of cash was used in returning dividends to shareholders. So $13.1 million was used for paying dividends to shareholders in the first half of 2021. And despite those uses of cash, we continue to reduce net debt. So net debt was down to $67 million at the end of the first half. One big factor in helping with that was prepayment of funding we'd given to scheme shareholder -- scheme smallholders during the first half of this year. So we provided initial funding to scheme smallholders when they plan to develop their areas attached to our own estates. But as those areas become mature, as the yields from those areas increase and the operating cash flows increase, so repayments come back to the Group from those scheme smallholders and $13 million was repaid to the Group in the first half this year. And overall, if we measure against the first half of last year compared to the end of the first half this year, it has been over a 20% reduction in the Group's net debt. And you can see where we stand in terms of balance sheet overall, over $390 million of net assets, very strong position in net gearing at 15% and we believe that very much support the Group's plans for continuing investment and continuing growth. Just a brief comment on where we are after the end of the first half of 2021. Included in the interim report was some information about crop up to the end of August, so all the way through to the end of last month. And at that point, we were up to 928,000 tonnes of crop processed overall; Chandra was sharing with you where we were end of June with just over 700,000 tonnes. So you can see how we've progressed in the last two months. At the end of June comparing to last year, we were 28% up year-on-year. And so we continue to be 28% up when we move forward to the end of August with 928,000 compared to 725,000 tonnes. So you can see that crop growth is continuing as we move through into the second half of the year. Then when it comes to pricing, we were $724 per tonne as an average for the first six months of the year. That's moved on even further as we move through to at the end of August, and our average pricing all the way through to the end of August stand up to $738. So you get a sense of just how strong CPO pricing has been in July and August. And of course, both of these factors absolutely continues to underpin our plans when it comes to returns to shareholders for 2021. I don't think I need to say too much more about the strategic and operational priorities, you've heard about them already. Construction of mill 6, focusing on planting, both Musi Rawas as well as building that mill, making sure we get to our minimum planted area of 10,000 hectares, and we've already spoken to you about that prior to identifying acquisitions of additional land around our existing projects. So that just leaves one final thing for me to share with you, which is let me just -- an illustration, but hopefully a useful and valuable illustration to share with you, which is really looking at where returns may be based on crop processed between 1.4 and 1.8 million tones, taking a few what we believe to be perfectly sensible and reasonable assumptions. The key assumption that I'd draw your attention to is the gross profit per tonne of palm product where we have assumed for the purposes of this illustration, this piece of modeling, $200 of gross profit per tonne of palm product. And if you make that assumption, and I should point out that if you go back and look at where we are in the first half of 2021, we're actually achieving more than $200 per tonne of gross profit. But if you make that $200 per tonne assumption along with the other assumptions you can see on the slide, 1.4 million tonnes of crop processed would lead you through to 70p of earnings per share. And then as you go across the slide, you can see 1.8 million tonnes of crop processed would lead you to 90p of earnings per share. I think the other two points at the bottom of the slide are I would hope relatively self-evident from the slide and from what you've seen, an increase in crop would obviously form the basis for those higher earnings, and therefore, an opportunity to accelerate shareholder returns. And then whilst the illustration itself doesn't deal with cash, one might expect cash flows and free cash flows to increase even more sharply once you get to a point where depreciation steps up and steps in front of capital expenditure. And just to go back to where we are, of course, we've just completed mill number 5 in our program of increasing our milling capacity and we aim to complete mill number 6 by the end of next year or around the end of next year, and we would expect that really to be a point at which we might expect depreciation to start running ahead capital expenditure as we've completed that mill expansion program across our existing portfolio of properties. So hopefully a useful illustration to reflect on in terms of what crop processed can lead to with some sensible, possibly even conservative assumptions in terms of the earnings per share. So at that point, I will pass back to Peter just for some concluding remarks.

Well, just to conclude indeed regarding our strategy and our values, we aim very much to grow in a responsible and in an excellent way and in order to help to deliver greater returns to our shareholders. We are looking forward to growing crops to increasing milling capacity and to a continuing investment. Initially, over the next two to three years around our existing projects that could be significant scope for growth; the acquisition of land around our existing projects, to make best use of our milling capacity. But as we go a bit further forward at bigger acquisitions, perhaps more like, let's say, 10,000 hectare type project that we've seen in the likes of Bumi Mas or Musi Rawas. We've produced, I hope you'll agree, an outstanding set of results for the first half with revenue up 69%, gross margin up from 12% to 33%, earnings per share up from 5.7p to 38.3p and we have a very exciting future ahead we believe with increases in crop yield and milling, which will support higher production and cash flows and certainly the opportunity for further increases in shareholder returns. So that concludes the formal part of our presentation. We seem to have a number of questions which we'd be delighted to answer. So perhaps, let's just have a moment to consider those.

Peter, thank you very much for your presentation there. [Operator Instructions] Investors have submitted number of questions during the presentation today. And I just wanted to hand back so that you can respond to those where it's appropriate for you guys to do so. So could I please ask you to read out the question and then who it is from.

I think -- and actually, there is a pretty good range of questions, and we can probably take them from the top as it were. The first is, can you add any detail on how easy or difficult it is to get permission to do extension planting? Have you anything to add about the land titles you were awaiting for as mentioned in the annual report? I mean in terms of extension planting, I mean go and see the Musi Rawas extension, the continuing planting of the land we already own for which we have now been given permission. So that has already got underway. And we expect, as Chandra said, to reach at least 10,000 hectares, hopefully closer to 11,000 or 12,000 hectares. In terms of planting that we might achieve in areas that we might acquire, and maybe that links in with the question about land titles if we were to acquire new land titles. I mean, we are unlikely to be acquire anything which is more of a greenfield type sites return to even if it's not environmentally-sensitive, generally we'll go for brownfields and the land titles will come with the acquisition of the projects that we acquire, unless I'm missing something regarding land titles, there is something that you would add on that, Matthew.

The only thing I would add on land titles is obviously we report in each year's annual report status of final receipt of the last stage, which is some of our -- some of the people on our call today may be familiar with, which is called the HGU. And in some instances, we were in the process of obtaining the final land titles in our existing portfolio of early stage. We're very close to receiving those final land titles. That process goes on exactly as you would expect and exactly as part of the Group's process, we will -- we don't give a full analysis of that as part of the interim report. We will give a further update on that as part of the annual report. But yeah, there is nothing of concern to report. That process just continues as you would expect.

Shall we continue to scroll down? Yeah, there's a question on the change of CEO. I don't think there's really anything that I can add to what has already been said in public and what I just said. But I would just add that the business continues to be managed very effectively we believe, both from Tunbridge Wells and indeed from Jakarta. So moving on to the next question. Would you ever consider a dual listing on an exchange more local to the operations? We have considered this. And to be honest, I think, generally speaking, I mean, being listed on one exchange comes with a lot of bureaucracy, and it would just be double the amount of bureaucracy and I think without the sort of returns that one might wish for. So I don't think we've been convinced on that. I think also it might affect for those private investors, if I'm not mistaken, a dual listing might affect the IHT status for those shareholders who are private investors on AIM where one of the reasons besides and many other reasons for investing is for the IHT status. But we certainly haven't been convinced that it would improve our rating by having a dual listing. But it's something we will continue to keep an open mind on, but certainly not being persuaded on that so far. Perhaps, Matthew, you might take the next question.

We have a question about the information we've provided in relation to our associate companies. Question being, is there any reason that we don't publish the pre-tax figure for the share of our associated company profits? The simple answer is no. We're obliged under the rules to bring into our income statement our share of those companies post-tax profits, and that's what we do. In our annual -- I had to remind you myself and I just had to look in our annual report, we provided quite a large amount of information about both the income statement and the balance sheet of our associated companies. We've provided information about their revenue, about summary of their balance sheets and quite a large amount of information. As it happens, we don't share what their pre-tax profits are, just their post-tax profits. But it's not because we're seeking to hide anything. It's just because that's what we're obliged to disclose under the accounting rules.