NAOS Small Cap Opportunities Company Limited (NSC) Earnings Call Transcript & Summary

Good morning, everyone. My name is Sebastian Evans. I'm the Chief Investment Officer of NAOS Asset Management. And this morning, I'll be running through, with my colleague, Rob Miller, essentially, what was the Q4 FY '22 investor update. Obviously, our quarterly webinar, which we've been doing sort of in these COVID times, all the material was lodged with the ASX if you didn't get it by e-mail. So if you're looking for the presentation that we're referring to, just jump on to the ASX and search under any 3 of our LICs and it was lodged this morning. The other quick piece of information is, I'll go to the disclaimer quickly. And just before that, as always, if you do have any questions, people have listened to this before, we do questions at the very end. [Operator Instructions] I'll try to get through every question, assuming it's appropriate. So it may take a little while. So if you don't want to hang around for the questions, obviously, no pressure. This webinar will be recorded and then sent around probably tomorrow. And then finally, as I said during the very long disclaimer, we do touch on many, many stocks in this presentation. As you would know, we're clearly not perfect. This is not an advice in any way, shape or form. So seek your own advice or counsel before you make any investment decision, and do not rely on the information in this presentation. So with that, I'll just start with the presentation. I'll try to make my section relatively quick because obviously, Rob has his section, which revolves around a lot of the key investments. We're also extremely privileged to have Simon Lee, who's the CEO of Urbanise -- or the recently appointed CEO of Urbanise on this call as well, and he will be giving a presentation on Urbanise and some of the markets that they operate in and I suppose some of the industry thematics that are affecting their business, which I think many of you will find quite interesting. We've had some great CEOs before. So I'll try to give Simon as much time as we can. For those of you that don't know who we are or new to NAOS, essentially, we're a boutique funds management business. But funny enough, we've changed this tagline today, so this one is a little old, but what I will say is we essentially want to provide long-term concentrated exposure to quality private and public emerging businesses. That's what we're known for. That's what we've done now, for all of you, this is my 16th year, done for a very long time. It's NCC's 10-year anniversary in a few months, 5 months. So essentially, we provide concentrated exposure to microcap businesses and also private businesses more recently. We have 10 staff, approximately 7,500 investors, and anywhere between $300 million and $400 million of stock, depending on what market cycle you've just gone through. Next slide, please. That's our team. I'm not going to touch on it in detail this time. I'll let you refer to in your own time. You know what, our investment beliefs we're very passionate about, and we do believe that it provides us with, I suppose, a competitive advantage and differentiation relative to our peers, especially in these very interesting times that we live in. We tend to focus on businesses with a lot of management alignment and proven management teams in our view. As you would know, we're very long-term focused. We've had some investments for 8 or 9 years now in some cases. We're highly concentrated. So some of our investments are north of 20% of the fund value. We believe in quality over quantity. We're focused on cash-generative businesses. We're not interested in pre-revenue businesses. And we also have a very strong focus on ESG. So touching on that with just -- with all our core investments, we provided them with an ESG questionnaire that's proprietary, was developed in-house. We've received that feedback and you will see those responses for all the investments, I believe, in our upcoming annual report, but there was 10 surveys from memory. And again, they're very, very detailed in the information that they get and we receive. We want to continue to focus on that with our core investments. And then finally, we are quite hands on. We're not an activist. We now sit on the boards of 3 listed businesses and soon to be probably a couple of unlisted businesses. We really want to support these businesses in their growth journey, not just by capital, but by strategy or whatever other way we can provide a benefit to them achieving their long-term goals. Reasons not to invest with NAOS. Yes, I'm sure many people can probably give me a few reasons themselves. But I think in my understanding of NAOS, I think the reasons why NAOS would not suit everyone is very simple. We're highly concentrated. We are very long term. So we're not in and out of stocks every day, let alone every probably 6 months. We do focus on very small businesses of $20 million to $500 million in market capitalization. But benchmark unaware is I think a lot of people don't know this, but not one NAOS investment is actually within the small ordinaries index, they fall out of that index. We do focus on industrial, so not resources in early-stage technology businesses. We're relatively small for our fund size because we believe that gains a meaningful exposure. And obviously, we invest by LICs and they can trade at discounts and premiums to net asset backing unlike an open-ended fund, but clearly looks to have their advantages when you're investing in the way that we do in the type of businesses we do as well. The financial year returns of the business, clearly, Q4 brought with at the end of FY '22. I think most of us be saying, thankfully, FY '22 has come to an end. Unfortunately, I think if the investment team and I sort of go back and look at the performance, clearly, we're not pleased with the performance. It was pleasing with 2 of those funds significantly outperformed their relative benchmarks, even though they are only relative. But even so, we felt like we could have had probably a stronger year than what we posted. One investment in particular for 2 of those funds really did lower our overall performance significantly. But I think when you look at the long-term performance of the funds, they're now all significantly outperforming the index. And if you look at our 3-year numbers especially, they're well ahead of those relative benchmarks. So I think that's pleasing. But at the same time, we know that we can't be pleased with the negative results for our shareholders. Probably a very topical chart is obviously the dividend history and the profit reserves. I did get a question on this. So this is as at 30 June, so our 30 June accounts. This is what the reserves look like. So if you look at NCC, you can see that the profit reserves are $0.45, for NAC at $0.50, for NSC at $0.21. You can also see what we've paid as a fully franked dividend. And then if you frank that up, what the gross effect or the gross amount we've paid out for all those dividends. So in the case of NCC, it's almost going close to paying its initial IPO price of the dollar back to shareholders over the last 9 years. Performance, I suppose, in a table, and it gives you the 1-year performance as well as the inception performance. As I mentioned, 2 of the funds did beat the benchmark by a significant margin on the 1-year performance. If you look at Q4, I probably told a bit of a different story, 2 of the funds underperformed and only one outperformed. Clearly, Q4 was a bit of a minefield unfortunately for emerging companies or microcap businesses. I'll touch on that in a second on the next slide. But importantly, if you look at the inception figures, they still remain very healthy, and that's what we focus on. And it's pleasing to finally get all 3 significant outperformance figure relative to the index, which has been no easy feat over the last few years. Just touching on some of the qualitative information we use. I do touch on this every time because a lot of people asked us, well, what research do you do as a team because our investments don't change too much. And maybe, Simon might be able to give some anecdotes as well. But obviously, we do a lot of internal engagement with executive teams, Boards and wider staff without a doubt. I would say a lot of those on external engagement are former employees, listed unlisted competitors and suppliers. We do a lot of hands-on research, which is very company-specific, such as cold calling or we're using the actual service. And then we look at a lot of research, the industry reports, even social media, forums, industry forums. And to give you an example of what we've done more recently. So one of our holdings, FFT, Future First Technologies, we've recently caught up with one of their unlisted competitors, probably their key competitor, MaxiPARTS is a big holding and we caught up with 2 unlisted businesses that you would call them a competitor, but they also actually use MaxiPARTS. They're not listed. They operate in Western Sydney. We caught up with them. So we do a lot of hands-on research on businesses that you would have very little idea that existed, but actually do have a very good and clean and outstanding of the listed businesses that we invest in. And it gives us some fantastic objective information. And then finally, the alignment. We're a big believer in this. We invest in aligned management teams. So I think it would be hypocritical for us to then not be aligned with our own shareholders, and I think this chart speaks for itself. You can see how the directors have continually increased their shareholdings in all 3 LICs and have a very substantial amount of shares across all 3 LICs. And then finally, just the case for concentrated investing. A lot of people ask why are we so concentrated. It's a bit like probably the Warren Buffet fit theory is diversification. We believe a lot of fund managers own too many stocks and then obviously gain or get an index return whereby we have what we believe is the optimally diversified portfolio of probably 10 to 15 investments whereby you're going to significantly deviate from the index, probably both negatively and positively over the longer term. You will get a very different return to the index. And hopefully, if your investment process and philosophy stands up, you will get a positive, I suppose, experience relative to the index. So just a couple of wordy slides before I jump into some charts and then hand over to Simon. Essentially, the Q4 summary, I'm not probably telling you anything that you don't know. Q4 was all about inflation. Inflation that probably stuck up on a lot of us. And how that hit home during Q4 with central banks obviously playing catch-up in regards to interest rates. For those of you that are caught up on the other night news, you would have seen that the U.S. Reserve Bank increased rates again by 75 basis points last night. And obviously, we've seen a record successive rate rises in Australia more recently as well. A lot of that stuck due to, obviously, the geopolitical issues, the war that we're aware of in Europe that's affecting prices such as oil and gas and agriculture, the lack of immigration in Australia, the lack of staff, which is leading to obviously increasing staff costs. We're probably more, I suppose, of note to what is obviously the valuation realism that we put in here. We've seen a big dispersion in regards to how stocks are being priced. So it's not -- the earnings of stocks probably hasn't changed much over the last few months. But for what people are willing to pay for a business has changed significantly. So it's really up to us to understand, well, is that earnings going to change in the future, or are these stocks undervalued or overvalued. And clearly, we've seen a lot of companies' mentalities have changed, especially in the private landscape, and that "growth at any cost" strategy has shifted to the "you need to be a breakeven and a profitable business in a reasonable period of time'. Thankfully, most of our businesses or all of our businesses are cash flow breakeven, most of them very profitable. So it's not an issue for them. But I think there's a lot more focus on margins and revenue growth in our longer-term strategy on how they're going to adapt to the new macro backdrop. And those last 2 points, I think it's interesting. So a good example would be Experience Co, one of our best-performing investments in FY '21, who's hands down probably one of our worst investments in FY '22 when you probably would have thought it would be the other way. But an example of a business that is probably struggling in a post-COVID environment. Even though the demand landscape will be a little bit better for them, clearly, they will be struggling with the likes of staffing. Impossible to get staff in the tourism business when you can get paid $200,000 to drive a lorry around Australia or whatever it may be. Then you've got issues with weather, the lack of international tourism, things like that. A lot of businesses are struggling with these nuances and they're not little nuances, they're nuances that have a significant effect on the business and the overall profitability in the short term. And then obviously, that ties into that last point. A lot of domestic business are struggling to deal with this, and it's not going to be a 3-month fix. A good example I was speaking about in the offices, it's more internationally based, but obviously looking at airports in the U.K. that are under pressure, they expect that to last for at least 12 months. So I think things like that will have a knock-on effect for a lot of domestic businesses as well. We have similar domestic issues. Just touching -- breaking down the performance. Clearly, we had a fantastic first half for these funds that unraveled in the second half of 2022. And this chart really does highlight that. You can see that without a doubt, technology stocks were the hardest hit. They were down 36% for the second half of the year in total return perspective. And interestingly, resources held up very well, essentially almost, while they were slightly positive. And this shows you the big discrepancy across all businesses. Clearly, that's probably reverted more recently. But does show you the big discrepancies in stock movements across all parts of the stock market. So what we have seen more recently and probably until today is that IPOs have been closed, the ability for businesses, big or small, to raise money, is virtually new. We've seen a big place this morning that's come to market and a stock that we've followed a long time, but to highlight what they're doing. I think it's $110 million raise, that half of that or more than half of that is actually being covered by management themselves. So it really does show you that equity markets are closed probably when it comes to raising new equity, either by an IPO or replacement. And just more of a visual representation of how interest rate expectations have increased. You can see here when we look a year ago, what the expectations were for interest rates. We thought 30 years we were trading at 2.1%. As of the 8th of July, we're trading at 3.75%, which is a huge discrepancy. And obviously, a lot of these interest rates are used to price equities through DCF models or whatever they may be. So a 50 basis point or 100 basis point change in someone's model on how they would value our business has a significant effect on a share price, especially in businesses that aren't making money and plan on making money in 5 or 10 years' time, which are mainly technology stocks. And essentially, why you've seen them fall so sharply more recently. And the one that's probably a little bit more confusing for us internally is really consumer confidence. We get a lot of questions on how do you think your portfolio is going to perform, how your investments are performing more recently. And a great example is COG today, one of our largest investments, did a call yesterday; yesterday with the brokerage, they prereleased their result. And as a finance broking business, interestingly for them, demand is still very, very robust. Speaking to someone else the other day, they're one of the Australia's largest manufacturer of forklifts in Australia, still extremely robust, and it's not robust for the next month. They have a pipeline at least 12 months out. So it's very interesting in a lot of the businesses that we see. From a demand perspective, things have probably still never been better. But if you look at equity markets and our consumer confidence, it's clearly telling you something very different. And how that plays out, we don't know, but we'll continue to try and invest in businesses that are probably backed by a long-term industry thematic that hopefully protects them over the medium to long term. And then just passing on to Simon Lee, just quickly, I'll introduce Simon firstly. But obviously, we built up a large position in Urbanise over the past probably 12 to 18 months. They clearly will be the first to admit that it was probably a little bit early in the scheme of things. But I would say, we're attracted to the Urbanise business because we believe they are an industry leader in what they do. They have fantastic software, especially in the strata space and FM space. And then more recently, there was a management change, which we're very supportive of. We've known Simon actually through also his former employer. So we've been able to get some fantastic reference checks. And a lot of those reference checks come across extremely supportive of Simon. I suppose the cultural journey he's taking that business on as well. So really want to thank Simon for doing this and taking some time out of his day in probably what's a very busy period. And I'll pass over to you, Simon. So thanks again.

Thanks, Seb and Rob, for giving me the opportunity to talk about Urbanise this morning. Today, I'd like to provide an overview of Urbanise, what we do and who we do it for. I'll also [indiscernible] the key technology trends impacting our customers and how we think about solutions for them. As Seb mentioned, I was recently appointed CEO for Urbanise after 3 years serving as CFO. Previously, I had worked extensively in the engineering maintenance sector and became quite familiar with the work order management systems similar to Urbanise. And it was my experience with a critical role of software in the FM environment that sparks my interest in Urbanise. Since joining, I've come to appreciate the strength of our strata business, that service is an industry that is also critically in need of technology, has potential for good customer retention, and benefits from mandated cash inflows thanks to strata legislation. It's the quality of our platforms and the value they bring to strata and facilities managers that makes me passionate about the business and the opportunities ahead. We service 2 types of customers in the property sector: strata managers and facilities managers, both are essential services, and in many respects the demand for these services is underpinned by legislation. We develop and implement cloud-based solutions to allow our customers to operate across their businesses. Our talented team is based in Australia, Bulgaria, Dubai and South Africa, and is made up of software developers, sales, implementation, and customer support specialists. Urbanise has been listed in the ASX since 2014. And over time we've refined our product focus in growing our customer base in various regions around the world. Our facilities business originated in Dubai and quickly ramped up in Australia as we developed the platform with key customers here. Our Strata business originating in Queensland, expanding across Australia, and then eventually into the Middle East and South Africa. Our single instance multi-tenant platforms have allowed us to bring customers regular updates and integrations as the solutions evolve to meet their challenging needs. Both of our platforms are enterprise solutions, meaning that they sit in the heart of our customers' operations. They're used by hour, day in, day out, by executives, frontline managers and back office administrators. So today, we've a mixture of small to large customers across the Middle East and Australia, and you may recognize some of the names on this slide. PICA is the largest strata manager in Australia and we work closely with their operational teams to create a comprehensive strata platform that has been scaled across their national business. Arvida is a new facilities customer in the aged care sector in New Zealand. Our facilities platform works well across organizations with geographically dispersed buildings and limited on-site facilities expertise. We are the only provider of the integrated strata facility solution and have some customers using both platforms. On to the next slide. To understand the role of technology in the space we play in, it's important to understand the world inhabited by our customers. Firstly, strata management may be familiar to you if you've owned a unit apartment in Australia. If you've received a quarterly levy to pay, it was most likely issued to you by a strata manager. The governing legislation for strata came into play in 1961, which I believe was pioneered by the founder of Lendlease, Dick Dusseldorp. Since then, the legislation has scaled globally with countries around the world adopting and customizing strata legislation. Strata managers administer their body corporates and their duties include record keeping, issuing notices, conducting meetings, managing repairs of common property, and budget management. Across Australia and the Middle East, we see huge complexity that must be managed by a system, particularly when a strata manager reaches scale and is responsible for more than just a few buildings. Strata managers have increasing community and social responsibilities, such as mediating disputes between owners relating to noise, incorrect parking, pets. Our Middle East customers like Nakheel focus beyond these responsibilities. Strata managers across that region include lifestyle management as part of their offering. One CEO said recently that his ultimate goal was to create a happier community. In that regard, strata managers are looking to promote community events to bring people together and ultimately make the building an attractive place to live. The next slide shows how we like to look at the strata market. There are businesses who have strata management as a primary focus. There are also residential leasing agents and property developers that also have strata management. Our addressable markets are determined by the number of strata titles in each region, as you can see from the statistics on this slide. Our obtainable market are strata managers who have scale and need a system. It excludes body corporates who are self-managers [indiscernible] managers increase in size and scale, there can be challenges of staff and cost management and consistency of customer service. On the right of this slide, I've included the names of the large players in each of these regions. Urbanise has a range of customers right across the spectrum, including PICA and Nakheel at the larger end. Small to medium customers are an important group as well. The barriers to entry remain relatively low for start-ups. With the right entrepreneurial spirit and the right system, we have seen smaller players scale up. On to the world of facilities management on the next slide. Facilities managers generally support the functionality and condition of building facilities, which can be residential, commercial or industrial. For example, this can include the responsibility for maintaining air conditioning and fire systems, managing trades and building works. FMs can have whole-of-life responsibility of these assets and will need to plan maintenance over many years to ensure they remain in an acceptable condition. There are 2 types of facilities managers we deal with, FMs employed in-house and those that work for professional FM outsources. Organizations may outsource the function to bring in specific experience and skills relevant to a sector. One of our customers has expertise in working with local councils that have a wide range of assets such as buildings, benches, public toilets, flagpoles. And this customer has built a reputation for being able to develop maintenance plans for these types of assets and to deliver within the constraints of local government budgets. Turning to the next slide. The application of facilities management is very broad. And I've included here some of the sectors that we've specialized in. The heritage of FM outsources can vary. Some are part of large international organizations. Tier 2 players tend to be more local and may have evolved from a trade background. Some of the larger players in our markets are shown on the right. As I mentioned earlier, facilities management can be performed as an in-house function by asset owners or custodians. Owners, of course, means organizations who own the building. A custodian could be a tenant who's leasing from the landlord and has some responsibility for the condition of the building. At the bottom there, you'll see strata. This is a common requirement in the Middle East, where the strata manager and the facilities manager are one and the same. In Australia, this is becoming more common, particularly with larger strata managers wanting to create new revenue streams. We serve all new customer types, and we found a particular niche supporting the FM outsources. Our platform is well designed to manage an outsourcer's upstream obligations to their customers as well as manage the activities with their contractors. So on to the next slide. One of the technology challenges being faced by these industries. We do see some common themes across strata and FM, and I'll summarize a few of these here. We hear more and more about the importance of our customers engaging with their customers by technology. Strata managers are focused on both owners and tenants, particularly to drive those community objectives I mentioned earlier. FMs already engage quite heavily with trades and their customers with mobile apps. But increasingly, they are focused on end users, such as the people who occupy the buildings being managed. As we emerge from the COVID work-from-home arrangements, property managers are concerned about helping businesses attract this staff back into the office. This is assisted by providing apps and portals that reach end users in a meaningful way. By integrating a range of services into portals and mobile apps, organizations are able to offer one-stop shop to the end user. For example, strata managers may be able to provide concierge services such as parcel and key management. They can promote building events, all of which can be bespoke to the building they're servicing. The benefit is the strata manager becomes more embedded with the body corporate through this value add. On the facilities management side, integrating room booking facilities or functionality, providing the ability to request repairs and notifying users of building events can also have the same effect. The right to play in the technology space is still very much grounded in driving operational efficiencies. Strata managers want to spend more time on winning work, talking to owners and tenants. Facilities managers have to carefully manage work and payment of their trades and automating their workflows helps them optimize cash management as well. Data analytics has already been leveraged by our customers to manage the financial performance of their businesses. But in the background, other valuable data is being collected to further enhance decision-making. For example, matching asset repair history and maintenance costs allows FMs to make better decisions on optimizing their maintenance plans. Strata managers are becoming more and more interested in the data being collected on tenant and owner engagement, particularly adoption rates and activity of mobile apps and portals. This allows them to better gauge what is of interest to owners and tenants and adjust community engagement strategies? This data can help determine whether a particular weekend family event that they're organizing, say kids' face painting or moonlight cinema, really resonated with the community. Strata and FM technology products need to accommodate changes to legislation. In the Middle East, strata legislation is continuing to develop as we see it. And that's really to cater for the evolving relationship between property development, strata management and community engagement. And FMs are always concerned with maintenance and safety standards. Business consolidations are an interesting trend in our radar. They occur as businesses drive for higher volumes of recurring revenue, just like us. Technology needs to respond by ensuring acquired revenue can be onboarded as quickly as possible. Tech architecture needs to be multi-tenanted and segmented so new strata titles and new FM contracts can be accommodated to that. Data migration techniques need to be automated as far as possible, and tech providers should be well-positioned to identify potential data cleansing issues before migration occurs. Finally, technology moves just like business, and we certainly keep a close eye on artificial intelligence trends, which seek to predict maintenance and asset conditions. Sensors measuring temperature and energy usage will help building managers to manage one of their biggest costs, energy costs. Strata managers will continue to automate tasks and reduce efforts on administration. And strata meetings can move online and repetitive tasks will be programmed. So tech providers like us have a choice to build for these trends or to leverage other technologies via integrations and partnerships. So hopefully, today, I've illustrated the strata and FM undergoing change and consolidation. And in that respect, we think technology is a very important role to play. Urbanise is well positioned to help these essential industries deliver into the future for a number of reasons. Firstly, we work very closely with our customers to develop our products so that they are closely aligned to the needs of both industries. That investment has been made over many years, and the products are well regarded and [indiscernible] as demonstrated by our retention rates. Secondly, we have extensive experience in Australia and the Middle East and continue to build our key reference contracts through strong customer relationships. And finally, we have a great team of subject matter experts that have a really good deep understanding of our customers' needs and are committed to design well thought-out solutions for them. So thanks for your time today, and I'll hand back to Rob.

Yes. Good morning all, and thanks very much to Simon for sharing his time and his insights on the Urbanise business and the industries in which they operate. I mean, it's pretty amazing if you think about it high level, but strata regulation was very complex, and it was started in Burwood in 1961, and it's become a genuine Australian export success story when you look at how many markets it has been adopted in. And we think, because of the expertise developed in Australia, that companies like Urbanise can continue to do very well with that trend over the longer term, specifically in the Middle East. I'll just touch on some of the key portfolio movements and updates throughout the quarter, starting with Big River, which has obviously been a very good holding of the NAOS for quite some period of time. You've seen in the sector a lot of sell-off as there's been some, I suppose, worry and kind of concern around the end of the building cycle or the construction cycle. Yet within that time period, you've seen Big River upgrade its FY '22 guidance. And furthermore, some industry commentary, although Sebastian has already touched on a couple of things around forklifts and the like. But you've seen the likes of CSR at their AGM put out very strong commentary around the existing pipeline for housing to touch housing, but also the fact that we don't have any immigration yet, and that's got to continue to come in time. So that pipelines, are they going to continue to grow out over time? And secondly, same with Newmont, which is the largest gold company in the world, specifically call out how much infrastructure spend is going on in Australia, between $200 billion and I think $250 billion. And that was a concern from them in terms of labor shortages in the mining sector. All of these areas and these industries are where Big River operate, have a diverse customer base across a wide range of industries. And we certainly think that long-term pipeline there of growth for the industry as a whole and specifically Big River certainly still exists. A couple of quick points on them as well. Throughout the month of June, they released a presentation, which updated some longer-term targets for them around their margin profile, but also their return metrics, and we think they're very strong in terms of what they've put out to market and it shows it's a high-quality business when you compare it to its peers. And also as well, there are, I think, approximately 33 sites that put a marker out there that they want to get to another approximately 10 over the medium term, but even still at, say, 45, they're a drop in the ocean when you compare to the opportunity set across the country. Eureka Group, which is our independent senior living business. To be honest, they had a pretty tough quarter. When you start out thinking about at least more floods. That was an unfortunate issue that there's not really much you can do about that. That's the negative impact on that business whereby their asset in Lismore. Now thankfully, all the residents have been relocated, but that is effectively out of use. And most likely, in our opinion, that's probably something that won't come back for some period of time, if not at all. So you've seen that impact the earnings and will continue to do so for a period into FY '23. But also, I suppose, more importantly, we've seen some downgrades from that business. We hate to use the timing issue as an excuse, but it genuinely was when it comes to settlements of properties that was supposed to have earnings impacts into FY '22. They've rolled into FY '23, along with increased cost base around resetting, I suppose, the framework of the business to kind of scale up to the next level from that. So we think we've had a lot of active engagement with the management team and the Board, trying to understand all the levers of that business over the next little while. And the next 12 months, probably set this business up for the next 5 years, when you think around capital management strategy, where they're sending their dollars in the framework to set them up to growth, and where they're going to put further dots on the map in terms of new sites. So we think a lot of planning and execution comes down to the next 12 months to set it up over time. Thirdly, Move, which is our transport and trucking business based out of New Zealand. They completed a pretty big milestone during the quarter, obviously, listing on the ASX, and now they're a dual-listed business. There's been plenty of success stories out of New Zealand that have done that in the past, and we think Move's got some of the pedigree there with the people behind it. Yes, it's a turnaround, but we've got people in that business that are building a strong culture. And I think with turnarounds, you need a strong culture and you need people that are coming into the business or focus on the margin profile. We think all those factors are occurring at Move and continue to occur when you're seeing some of the likes of some key appointments made throughout the quarter, specifically in the dairy and also the ocean freight business, which are 2 growth areas that they've talked about and now they're going to execute upon. You've seen that with a $10 million grant they're getting for a new boat they're going to set off, which will run sea freight up the kind of South West Coast of New Zealand up to the North Island as well. So yes, the environment is tough. It's tough to get, obviously, trucks and everything into the country, New Zealand, that is. And obviously, labor shortages, all the factors that you're seeing globally are playing out there, clearly, and the turnaround may take longer, but it's certainly going in the right direction with the right people there at the wheel. Coming to the next slide. I won't spend a whole lot of time on Urbanise given we've just heard from Simon himself. But all I would say is a few extra comments around the Board. There's been some commentary around upskilling the Board around the Software-as-a-Service space, and we are big believers in that for the Urbanise business to take it to the next level when you think it's a global software business. So there should be an improving profile of software experience at the Board level and throughout the business as well. They've had a couple of trading updates throughout the quarter. Firstly, they were negatively affected by a contract loss, which was the Ventia contract loss. That was a head office decision by Ventia where you were led to believe that there is unfortunately not much you can know about that when there's a change of strategy at parent co for a different software solution. But to offset that, more importantly, we believe, is the Colliers Australia integration and execution of putting their software into that business and hopefully rolling it out further continues to go well. And just in the last week we've seen Urbanise under Simon has done a great job to date, obviously, as CFO, interim, and now CEO. We've seen the cash flow profile of that business at their quarterly get back to a breakeven period for the June quarter. Just coming to BSA business that's no secret. It's certainly been a tough one for us and caused a lot of underperformance in some of the funds throughout FY '22. But the balance sheet repair has been done. There's been a couple of raising occur. Brendan York, our colleague here, is on the Board. And we think the necessary steps are being taken and have been taken in terms of management and Board to kind of reset the shift there. And this is happening right now with an improving operating environment for them. So when you look at industry peers, and you see the likes of NBN coming out and saying, even as recently as today, saying that the NBN will stay privatized and they're happy to invest more into the NBN to ensure that it's an adequate network for customers. That's not just a one-off investment. That happens every year with maintenance that follows on with that. All of the operating environment now for BSA should and is continuing to improve. And now it's on the right footing with the right people in there. And obviously, the search for the full-time CEO does continue as well. And finally, just on to FFT, which is one we've not really spoken about much on the webinars in the past. It's a relatively new one, small business within the portfolio of the group. It certainly needs some corporate restructuring to occur. But the thing that really attracted us to that business is the underlying product, very similar to Urbanise. It's a niche product, but it does what it does very well, and there's a genuine need for what they do. FFT, I should say, it's all about kind of fine to fix issues with pot holes, anything with road maintenance, the ability to identify any issues, potholes, line markings, trees on the road, cracks in the road, all of those things that need fixing over time, but it's certainly done in a manual process to date by councils and government. The ability to have AI and machine learning work with that and make it a lot more streamlined and then being able to appoint the work orders at the other end. So effectively, what FFT do in their core business and under the leadership of Adrian Rudman, he's someone we've known for a little period of time now, and his pedigree, in our opinion, is excellent. He's a 20-year veteran of Objective Corp business that has been a staple of the NAOS portfolio for over many years and a business we highly respect under the leadership of Tony Walls. You can see that pedigree in Adrian already with how he is going about allocating capital, selling noncore businesses, and focusing on what really matters in that business. So a long way to go, but it's a small one and one we're excited about for the future. Next slide, please. Just coming to quickly on the specifics of the funds themselves. Look, not a whole lot to touch on here. Just apart from the final dividend will be paid out -- sorry, announced at the August results across the 3 portfolios. You can see the number of holdings across the groups, the different portfolios, I should say, has slightly picked up, and we're seeing some opportunities out there and clearly markets that have repriced a lot of businesses down quite substantially. So coming to NSC -- NAC, I should say, coming up next. The buybacks in place there. We've been paying out $0.016 quarterly dividends for FY '22 to date. And obviously, the final one will be announced in due course. And just touching on NSC quickly with the buyback in place there, that is reset again in April. And if you look at any of the announcements, you can see we've been reasonably consistent and aggressive in our buyback where applicable. So we've already bought back another 2 million shares and we continue to see value in doing so. And that's a capital allocation decision by the Board across NAC and NSC. If there's value there, and we're happy to take the long-term view, we'll continue to execute on the buyback. So with that, I will hand back to Sebastian.

Thanks, Rob. And I'll finish off just obviously, with capital management initiatives, a little bit of an outlook, and then questions. So I'll just emphasize again, if you do have any questions, feel free to put them in the chat box in the bottom right corner or e-mail the team at [email protected]. Probably got, I don't know, 20 to 25 questions already, some on the mobile app, so I'll try and slip it down as much as I can. But as always, there's pretty good thought-provoking questions, which I'll touch on each one as we always do. Capital management initiatives. Look, I think we treat this just as what we expect from our investee companies. It's all about performance. I think we're kidding ourselves if it's not. We want to continue to maintain a strong level of performance over the long term. We think we have, but we definitely want to improve on that. That performance then equals dividends. We want those dividends to grow over time and be franked to the maximum it's possible, which is obviously what we've done to date. We want to continue with increasing our alignment. So we're very much in line with all of our shareholders. We want to provide very good quality, transparent, timely information to all of our shareholders. And then as Rob touched on, we've got the buybacks, which as many of you would know, some have been very aggressive in the past, and then some have probably died down a little bit as the discounts have finally started to close. So with that, I'll just touch on the final 2 slides, which relate to the overview and outlook, and as I said, this is crystal ball stuff, but I think it's important we do provide an outlook for the Q1 of FY '23. We're already a month up into it or I suppose so. I think what we're seeing already is companies are continuing to adjust to the post-COVID environment, whatever that may look like. I think it's changing by month to month. And what we're seeing is full year results for the full year '22, but unfortunately, it just has been with the [indiscernible] with the past 2 reporting seasons, everyone's probably more focused on the outlook. I think people will be focused on how the first 2 months of the trading year of FY '23 have been as opposed to how was FY '22, which will probably be a shame, I think. So I think you'll see some good results. But I think may be put to the side and the outlook would be more important. How is the consumer being affected by interest rate increase? I just got an interesting note from hipages. Interestingly enough, cancellation rates from tradies are now back to pre-COVID levels, starting to see less demand from consumers for tradies through hipages. I don't know, a very small anecdote, but I think relevant nevertheless. And the big one, inflation. Obviously, inflation has been high more recently and is being obviously tried to be contained through very aggressive interest rate increases. What happens in 24 months' time with interest rate increases, will they go too far, will demand collapse in a heat, and will interest rate increases turn into substantial interest rate cuts? No idea, but some people will definitely hold that view. But as always, small caps are inherently more volatile because they're less liquid, they have fewer customers, and they probably operate in niche markets. So I think we're all very cognizant of that, just like most of our businesses would fall in that basket. And then more specifically on the next slide. August is probably a big month of the year. Most of our companies, probably 95% of our companies, will report on their full year '22 results. And we think it's hopefully going to provide some significant catalysts for the likes of, I've listed a whole heap there, but I'll try and list as many as I can. I think a great example is Move. Move Logistics has been very quiet because they are really concentrating on turning that ship around. They're going through a cultural upheaval, it's probably how we're putting it, new management team, new exec team, new general management team, the whole kit and caboodle. And I think you'll finally start to get some clarity on the strategy and what they're trying to execute upon now they've had time to think about it and I suppose calmed things down internally. MaxiPARTS, another great example, their first full year result as a stand-alone entity, so who knows what to expect. But we really believe in that business and that management team and the margin, the debt potential, and also the industry tailwinds. Saunders, which I'll touch on. So I've already got a question on it, but obviously, been very quiet for the past 6 months, but we expect an update on that $165 million contract that they're currently building or constructing in the Northern Territory. Gentrack, another example, they've put a 3-year strategy target out 1.5 years ago. So it would be interesting to see how far on that journey they are. I mean, last time we spoke to management, they remain very confident on it. It was correct to see that they picked up quite a large customer in Singapore, which wasn't released on the ASX, but it was on their website, which does show they are getting traction. Urbanise. Unfortunately, for Simon on this call, have made a lot of supposed comments on getting to that cash flow sustainability level of their business. I think for that to occur, that means, that's from my point of view anyway, and I'm not sure what Rob's point of view is, they must have some confidence around our sales pipeline, which we would like to see some transparency around that. And then BSA, which has unfortunately been our worst investment since inception, after being our best. Just, now Brendan's on the Board, obviously, we're quite close to that business. But touching on that CEO recruitment process, any potential divestments should really steady that ship and focus on, as Rob said, taking advantage of what would be a reasonable demand backdrop for them considering what's going on in NBN at other places. And then finally, just before I get to questions, just to remind everyone about that 1% pledge, there's a slight change. As you would know, we've said this a lot, NAOS as the manager, not the LICs, we pledged 1% of our revenue, time and intellect to 3 what we believe are significant movements and missions that matter. You can see the 4 charities there that we support. We also support a number of things for providing physical activity, and then also intellect, and more recently, Jared, he organized an internship through F3, which is a female focused group that focuses on providing those women with necessary work experience in the relevant industries that they're after. So we took on one of those groups over a 7-week period to give them the exposure they were after, and cost management is an example. We continue to want to give back as much as we can to those who need it. So I'll just rip into the questions since there are so many. And as I said, there are quite a lot of questions. So if you don't want to hang around for the answers, completely understand. It's not like you have to. And for Simon, I know Simon, unfortunately, is actually on a strategy offsite today. So I might give the first few questions to Simon so Simon can disappear, so he doesn't feel like he has to miss any more of his strategy day. And unfortunately, Simon, you probably could guess what these questions were going to be. There's been another one on this topic. So I'll just start with that one straight away.

If you could just touch on what is the current outlook for Urbanise turning cash positive as you refer to cash flow and sustainability?

I wouldn't disagree with your earlier comment around sales pipeline. The strategy around cash positivity does rely on converting our pipeline. And certainly, at the full year, we'll take the market through our assumptions around that. And in terms of, I guess, converting those pipeline opportunities, we are confident that we've got very, very quickly opportunities in the Middle East with large customers there, small to medium customers in Australia. And we're seeing a lot of opportunities in the FM outsourcers that we already have. So that's a very, very high level of synopsis around our pipeline. In the meantime, we've clearly taken some tactical measures around working capital, cash and advance strategies, or initiatives. And we did some cost initiatives early on in the second half, which has really put us in a good position. So the outlook is really underpinned by sales ARR as well as professional fees that we'll get in the lead up to getting the ARR. So we think we're in a cash sustain -- we'll reach some cash sustainable position. We're not giving a forecast of when, because that is quite difficult, but it really is around our sales.

Okay. And then as you can probably see, and I know we've touched on before, I think it was in your last quarterly, just maybe some clarity around UBN and its plan or process to migrate new clients and net data across to your system, which obviously is a key part of the selling proposition I suppose for your software.

Yes, that's right. I mean, look, with our experience with large strata managers, PICA, Nakheel, these types of customers, so people understand what that challenge is, large volumes of strata titles moving from perhaps one legacy system to ours. And that means a lot of historical data in some respect to property data that needs to be moved very, very quickly so it doesn't disrupt the business as they cut over to the new system. So we've learned a lot over the last 18 months around how to do that better and on a more automated basis. We've invested in what we call bots, which automates part of the extraction and transfer process. So you have ETL, extract, transform, load, and so we've also learned that it's also a project management skill set to really work with the customers upfront and plan that process through, so they can make some decisions as to whether they actually bring all the data across. I think, specifically, the question might have been around historical data. Customers don't necessarily need to bring all their data across. And we've seen that recently with some of the customers we've secured in this quarter, where they've taken that decision not to bring every single data field across and they actually will cleanse and work through that data themselves. So there's choices for customers do that. And I think we've certainly made some changes in the way we manage data migration to really derisk it upfront before we get straight into the actual exercise itself.

Thank you very much. As I said, I think that might be it, but I know you're in an offsite, so if you want to -- don't feel like you have to hang around. But obviously, thank you very much for your participation. And obviously, all the best for the full year results.

Thanks very much. Cheers.

Cheers. There's obviously questions on the webinar. I've also got a printed copy of all the questions. So I'll start with the printed copy and then try and rip through those ones that we received more recently. So starting with the first question from Peter, who I do know well. A question on Saunders, just commenting on will they finally build a stronger full year results? Or will they touch on supply chain issues, labor cost shortages, et cetera? Look, obviously, we have no idea what the result is. I would say Saunders provided a full year guidance at the half year. So I would imagine, if they haven't announced anything now, I would expect a result within that guidance range by all accounts, and then we're trying to find out as much as we possibly can. We believe the execution on that major project is going well. So we're disappointed that they have been quiet. But at the same time, they've been quiet historically, and I don't think just because they're quiet means there doesn't mean there's a lot going on. So we expect a strong result and hopefully a strong update on the pipeline and future work, which we believe has probably still never been better for Saunders. But that contract they won in the first half was 3x or 4x the size of what they won before, so I think it's imperative they do an excellent job with that. And I think Mark and his team are very focused on that. A question from Adrian. Just interested in the outlook to shares, particularly small caps and LICs in the medium term. I suppose 2 parts to that question. So small caps, look, I think there's no rhyme or reason for small caps. The only thing I would say is, and I think we saw this today, results from [indiscernible], which unfortunately, we don't own, we're a fund of that business, but can't get ahead around the valuation. We continue to think that small caps that are backed by a good, strong industry tailwind will continue to do well, because they'll continue to be able to grow regardless of the macro environment, and they will get that multiple uplift over time. But whereby other small caps that don't have that industry tailwind or continue to lose funds, which there are many of them, will continue to disappoint. Your question on LICs, interesting, we talk about this internally a lot. The thing about LICs, the LIC industry in general has shrunk significantly. And I think that's working to our advantage and the advantage of the LICs that remain. I think if you're a LIC and you add value and you provide export to a unique asset class, you will continue to do well. And by do well, I mean, you should trade close to NTA. Hopefully, you can perform well and provide good dividend growth. [indiscernible] I think is starting to see not only that from us, but I think peers in general. There are some LICs out there that do a fantastic job of ticking all those boxes, and I think they will continue to do well because investors can't get that exposure anywhere else if it's in micro caps, private equity, agriculture, water rights, whatever it may be. Edward, there's just a question here on gold and silver prices. Unfortunately, Edward, we don't invest in commodities. So I would probably give you the worst advice at this. So unfortunately, I can't give you any outlook comments. A question from Bill, and a good question. Why are you not offering an in-person event? Perhaps a hybrid model would be helpful. I miss the face-to-face interactions. So do we, Bill. So we will be back on the road in October. So from memory, you're putting me on the spot a bit, but I think we're doing 5 or 6 capital cities for our national roadshow, which we used to do twice a year, which I think is what you're referring to. So the next quarterly webinar won't be a webinar, it will be face-to-face in the likes of Sydney, Brisbane, Canberra, Melbourne, Perth, I think we might have included Hobart this year as well. So we will be back, and hopefully, we will get a good attendance. And hopefully, we can provide a good presentation as well. A good question from Kathy here. Well, it was actually for Simon, we missed this. But Kathy, since I've missed this and made a complete mistake, I'll send this to Simon, and I'll send you an email. So my apologies, but I will get you an answer regardless. So my apologies for that. Peter. Considering the low volume of trades in the NAOS bonds, would you consider raising capital to increase liquidity? Peter, yes, good question. I think as we've always said for the last 10 years, we'll only raise equity if it's in the best interest of shareholders. So it's got to be at NTA, and we've got to be able to do something with that money. So never say never, I couldn't imagine us doing that today. But depending on the opportunities that we can find, it's something we would look at, but it would have to benefit all shareholders. Dennis White. Please discuss the widening gap between NTA and share price. Thanks, Dennis. Look, more recently, frankly, the discount to NTA has not closed significantly. So today, NCC, I think, is trading at NTA. NAC might be at a premium to NTA. So I think it was very close to or at NTA. So it's like NSC was at a slight discount, I don't know, 7%, based on where it's -- I've got obviously live data as opposed to the data that was released a while ago. So yes, it's great to see it's closed. It's not perfect, and it's something we continue to work on. But as I said, we think we've been very effective at doing that. I appreciate it's taken a long time in the case of NSC, I am not denying that, and it's not perfect, but we think we've had a lot of traction recently. Question from Lee. Thoughts and opinions on the market with inflation and interest rates increasing, in particular, the tech space. Yes. Look, as I said, I think the best way I can describe it is a lot of analysts, and you've seen this recently by people changing their target prices for tech stocks, they value them on DCF models. Cash flow is out 30 years and they discount them back at an interest rate, a discount rate. Obviously, that discount rates increase significantly. And the certainty around that cash flow in 20 years' time has changed significantly, which ultimately means a lower target price. That's how I would sort of tie that into where we are today. The interesting thing, though, more holistically is, technology in general is very deflationary, because it's more productive, it's cheaper, it's more efficient. So I would keep that in the back of your mind, and regardless, there are some technology stocks out there that are fantastic businesses. So I think regardless of the inflationary environment, if they can grow, they can get traction and become profitable, they will be excellent investments. So stick to the ones that -- we do anyway, stick to the ones we know good industry fundamentals, run by good people, but are profitable. That's how we think about it. A question from Claudia. What is the largest position in NCC? And are you expecting mean reversion to impact your holdings? Great question, Claudia. Look, in NCC, we've probably got 3 at a very similar size. So if you're thinking the likes of Saunders and Big River as some examples. Do we expect mean reversion to affect our portfolio? Probably has more recently. Mean reversion definitely affects us when things get quiet. So we need news flow of these funds really -- we haven't read news flow, unfortunately, so a lot of our holdings like Saunders go quiet for months and I think that drives people to become quite nervous in markets like we are today. So yes, in the short term, it hurt us a bit. And I think Rob and I are very confident that in the shorter term more recently that we're going into that with some news flow, that mean reversion will move the other way. Hopefully, we can really drive some of that performance. In August and September is generally when we do -- 8 times out of 10 we normally do our best performance in these cases when these stocks stick their head up out of the water and really update on the progress that they've made and the profits of that term. So fingers crossed, that is our August, and we may get the outcome that we're not after. A question from Greg. Just commenting on NCC and, say, can be patient as long as the dividends get flowing, but is there a plausible strategy to improve the share price going forward? Well, essentially, the share price is driven by capital growth, which is driven by performance. So we need to perform to drive that share price higher. The other thing I would say is NCC is on a very high yield. So I think we pay $0.075 per year. So if you work that backwards after fees, NCC to get a share price uplift probably needs to do 9% per annum before the share price actually could increase, because the dividend comes out of that share price. So if you believe we can do better than 9% per annum, which I think we've done 10% over 9 years, then the share price should increase. But to get meaningful performance, we need to do [indiscernible] days to get that share price going in the right direction in a meaningful way. A question from John. Just interested to know what the strategy of investment is by the people doing it. Look, as I said, John, at the very beginning, we provide concentrated exposure to quality private and public businesses, or emerging companies, all right. So emerging companies can be quite large, but concentrated, but essentially, they're emerging businesses that we believe are going to grow over the longer term. And we provide you with a very concentrated exposure to these. So for us to drive performance of your investment, you have to believe those investments will increase the value over the longer term. Question from David. Fund managers reside in the diversified financial sector, which has underperformed. What do you think of essentially valuations for fund managers in the second half? Yes, tough gig, David, obviously, running a funds management business. There are 2 things that drive fund manager's performance, performance fees and fund flows. If you're not getting any of those 2, you're obviously going backwards because you've got a fixed cost base. What do I think the outlook is? Look, obviously, it's not great. But I would also argue that the best way to play a rising market here is through funds management businesses. So if you want to be contrarian, pick a good quality fund manager. It's a great way to play a rising market, which you will get a lot more beta than what the market will give you. I'm not saying fund managers are cheap, but I'm saying if you think the market is close to bottom, there's no better way to play out than through a fund management business. One question from Stephen. Thank you for the compliment, Stephen. Just it's really, state the ways you add to the profit reserves. So essentially, our profit reserves come from profits that we make through a reportable period or whatever that may be, so a month or a quarter or a half or a full year. And then those profit reserves decrease by the amount of dividends that we pay. So if we add $0.10, in the case of NCC, we then pay a $0.075 divided, then the profit reserve has increased by $0.025. That's how that profit reserve moves. It doesn't move by fund losses. That is put in a different part of balance sheet. Mike would like to see weekly NTA updates. Thanks, Mike. We'll get to this question in a bit. Look, my feedback is that the portfolio is too concentrated and volatile, and it doesn't tie with our investment philosophy for quite long term. That's why we don't do it, and we don't want people focusing on the short term. The one thing we are thinking of providing is a monthly NTA update, like we do now, but a much more detailed quarterly update, which probably doesn't adhere to what you're after, but that's what we're thinking internally from the Board's perspective. Aidan. What trades were made in the last few months? Unfortunately, I can't give you that information, but if you do have another question, Aidan, happy to answer that. Just touching on the webinar questions here. Apologies, I'm just going to read them. Mr. Tom said -- thank you again for the compliment. Where can I find the key dates for the 3 LICs? Good question. Unfortunately, we don't provide key dates. What I would say is -- so there's 2 parts to your question. So in regards to half year and full year profit announcements, they're always very similar in when we release. So if you look at this year, I think we're planning on releasing on the 18th, from memory, which is always within a day that when we release or have released over the past 5 years. So I would use that as a date for all 3 LICs in August. And then in regards to dividends, we don't provide dividend dates. But in the case of all 3 LICs, we will provide dividend date for the full year result. NCC is half year and full year. So NCC's dates will be in the half year and full year accounts, whereby the 2 other LICs at quarterly, so we announced them quarterly. So the best guidance I can give you is just look at what we've paid -- got it and paid for it historically, and that will give you a very good idea, because we like to try and be very consistent. We don't like to jump around too much. Question from Alistair, talking about the last time I spoke about NSC, I said there was a large shareholder reduced. That's correct. They've actually sold out. And then the price should recover. Based on the information I have, the price has fallen further since then, but then that has improved recently. How do I explain the considerable further fall and then the more recent improvement? So yes, as I said, so that 3 months ago there was a very large shareholder who sold out, and that is correct. Obviously, 3 months ago, we entered a pretty aggressive bear market, hence why the shares fell. So I think the performance is negative, like if you look at the last 3 months. For NSC, they're pretty aggressive numbers. So like we were up for the year that did negative -- or plus 9, negative 9, negative 8, so the last 3 months really hurt us against why the share price has fallen. And then more recently, as I said, we've seen that discount to NTA close significantly, just as I think you've seen a lot of liquidity come out of NSC and the market has come down and hopefully, people have some positivity about our core holdings. And hopefully, as I said, hopefully, that continues to close. And the shares go to close to the mid-80s as opposed to, I think it was 79 today. So it's not far away from NTA. Peter. A question on Urbanise, which we answered. Just a reminder, there is a survey at the end of this. So we're always seeking to improve. So if you do have any ways, suggestions we can improve, please don't hesitate to complete the survey at the end of this webinar. Question from Percy. I know you emailed the other day. Can we publish more fundamental ratio data such as PE ratios for our LICs? Good question, Percy. As I said, depending on what we do, we may move away from the commentary in our monthly reports to give you more statistical data. And then me and the team will provide a much more in-depth quarterly update, which we think suits our philosophy. So I think there's a chance you may get a lot of your quantitative data monthly, and then we'll provide that more in-depth qualitative analysis on a quarterly basis. So I'd look at that and hopefully, within the next 3 or 4 months. A question from Greg, what is the outlook for dividends for the funds? Good question, Greg. Unfortunately, I can't provide it, but I can say that if you look at our dividend chart, they've been very consistent for NAC and NCC. They've always remained stable or increased over time and we want to continue to do that. Our profit reserves are healthy. The same goes for NSC. So I think the Board is very focused on maintaining or increasing dividends. Whether or not they're franked, fully franked, partially franked, or not franked at all, that's a much bigger decision, because we run illiquid portfolio as we need to pay tax. So for us to pay tax, we have to realize the gains. We have to sell a position that's in a gain, which is a lot harder, but we need to realize franked income from our stocks, which is becoming easier because our investments are mature. So I think what I can say is, look at the consistency that we've provided, and hopefully, that provides an indicator for you. But as Rob said, you will find out on the 18th of August. A question from Aidan. Why do you need 3 LICs to run similar strategies in essence is, I think, what you're trying to say. Yes, good question. We get this a lot as well. I think the 3 LICs are inherently different in some way, shape or form. So NCC, it operates in very small businesses, has 2 private businesses now. So it is quite different to the other 2. NSC and NAC are probably more similar, but NAC is probably a bit more concentrated. So we think there are some nuances that give them very different outcomes. I think you've seen that in the performance. And that was the best performer in '21 and worst performer in '22. So even though people think they're asking more, there are nuances that do provide quite different outcomes and we think that provides different exposures for our shareholders. And to be honest, a lot of the feedback we get is quite positive. People like to own 2 of the 3 or some own 3 of the 3. A question from Hayden. On the 3 LICs, given the concentrated long-term exposure in small caps, are the dividend drivers behind growth from a cash perspective, or are the profit reserves important given the solvency test on dividend declarations? I would say our dividends are driven by the profits that those companies probably make in that full year. I don't think they rely on profit reserves, because the companies are probably too immature. So it really depends on yearly profits and the balance sheet position of those businesses. It doesn't rely on the reserves they may or may not have. I think these businesses are not too small, but it's not at a position to fall back on a reserve in a loss-making year. So I wouldn't expect that at all. And then [ BSA from Nava ], some clarification on the NBN-related negative issues. I think that might have been, you might have your lines crossed. I think Rob was referring to positive issues. So I think there was an article in today's paper whereby the labor government, as expected, has stated that they intend to keep NBN private and probably focus on reinvesting back into that business. So they want to continue -- I'm probably speaking out of school here, they want to continue to expand on their offering, increase the speed, the quality. So essentially, what that means is more work. So hopefully, more work for likes of CSA and service stream and down and all the other contractors that have significant exposure to NBN. And I think as long as there's the labor government, hopefully, that will continue to be the case. So we don't see any negative related issues in regards to NBN and to BSA. So with that, that's all the questions I've got. I want to thank everyone again for their participation. As always, if you do -- I do get a lot of questions directly. So if there's something you wanted to ask me or any member of the team, feel free to e-mail me or in the inquiries e-mail and we'll get back to you fairly promptly. So thanks again for your support, and fingers crossed for good reporting. Enjoy the rest of your week. Enjoy your weekend. Thank you.