NRW Holdings Limited (NWH) Earnings Call Transcript & Summary

Thank you for standing by. Welcome to the NRW Holdings Half Year Results Conference Call. [Operator Instructions] I would now like to hand the conference over to Jules Pemberton, CEO; and Richard Simons, CFO. Please go ahead.

Thank you very much and good morning or good afternoon, everyone. Welcome to our half year results presentation. It's been another very strong half for us, particularly strong one in terms of improvement in margins and a rebound in the MET business and setting ourselves up for a very strong finish to this financial year. We achieved revenue of $1.43 billion, which is up 6.7% on pcp. EBITDA was $157.2 million and EBITA of $92.1 million, all up on the prior corresponding period, including obviously normalized NPATN of $58 million, up 8.6%. And we continue to maintain a strong order book of $5.5 billion. $4 billion of which is actually secured for FY '25 and I'll talk about that a bit more later. Strong cash holdings of $176.7 million, slightly reduced on the second half of last [Technical Difficulty] Richard will talk about that in the [Technical Difficulty] remains very robust at $15.6 billion with around $2.6 billion of submitted tenders that are currently active, we're working with clients on. The franked dividend is an increase on pcp of 9.2%. Last period was an unfranked dividend. We have a fully franked dividend this period of $0.065 payable in April. And we continue to be on track. We're reaffirming our FY '24 guidance that we gave at the AGM in November, which we expect to be at the high end of our guidance range, which was $175 million to $185 million of EBIT but as I said, our first half performance is setting us up very well for a strong finish to this financial year. So I'll now hand over to Richard and then I'll rejoin on the operation slides.

Thanks, Jules. Good morning, everyone. As Jules noted, we had a 6.7% increase in revenue over the prior period, which is really pleasing to see. And that really reflects what we're seeing operationally, which is an increase in market activity right across the business. And that was also assisted by the absence of any impact from severe weather because everyone would be aware, there's been an awful lot of bad weather going through Queensland, in particular, over recent months. And fortunately, there has not been any significant impact on any of our projects. As I'm sure you will all recall, it was a significant factor in our results in the prior period. So it's good not to have that effect again. Another key distinction between the 2 periods is the improvement in the rate of award of new projects. So again, delayed awards really overshadowed the prior period results. And we've seen a noticeable improvement in the rate of awards. Generally, we're seeing delays are now diminishing. The higher revenues supported the delivery of a higher EBIT, and that grew by 9.1% to $92.1 million. And as Jules noted, very pleasingly, the growth in EBIT was accompanied by an increase in the margin percentage, up from 6.2% in June to 6.5% in this period. The growth that we're discussing today is occurring across all 3 of our operating segments as the generally favorable market conditions are supporting a recoverability -- sorry, a recovery in profitability to really what we regard as long-term norms. So in this half, we've seen the margin in the Civil segment grew to 4.1%. Mining has delivered a very strong 9% and as Jules noted, a significant improvement in the MET margin to 5.5% and particularly with reference to the last 6 months, it's a huge step forward, as all of the legacy projects that the MET segment, Primero in particular, we're dealing with, have now fully closed out in the prior financial year. We expect those levels of profitability to continue into the second half. And as Jules said, we're retaining our views on guidance. There were some nonrecurring items in this period, which was a net cost of $21.1 million. The main components of that were the Wartsila settlement, which we discussed and announced to the market in September last year, that was $25 million. We also had some legal expenses associated with the litigation of about $3.3 million. And offsetting that was a gain on listed investments, notably the $37 million Spartan Resources shares, which rose in value by $0.345 per share over the period. Interest expense in this half was 13.5% higher than the prior period at $9.2 million and that really reflects a higher level of debt with CapEx. I'll talk about in a moment, plus also a higher incremental cost of funds on new equipment finance. That really, of course, is just a reflection of base rate movements in the market. Tax expense for the period was $16.9 million. Our effective tax rate was 28.8%, lower than the notional 30% because of lower tax rates in the U.S. and Canada and also some losses that we offset. So our statutory net profit result for the period was $41.7 million. And the normalized NPATN was $58 million, the delta, of course, being the $21.1 million of nonrecurring transactions that I just mentioned. So this operating EBIT result is in line with the guidance that we have provided and really positions us very well to achieve our full year guidance. Jules is going to talk through the performance of each of the segments and the outlook so I won't steal his thunder. But I will say that we're very pleased with the trajectory of each and excited about the growth prospects that we can see across each segment. I'll just turn next to the balance sheet. So as Jules noted, our headline cash number for the period end was $176.7 million, with cash conversion of 63.4%. That's a pretty healthy cash outcome and compares favorably to the prior period where -- prior comparative period where cash was $154.8 million with a 44% conversion. Our cash number at the period end would have been better but for some clients who chose to pay late to really improve their own period and cash positions. So invoices that were due for payment and should have been paid pre 31 December were not paid until the first week in January. So all up, there was about $31.6 million of late cash receipts and had those clients paid on time, then our cash number at December would have been $202.8 million with 83.4% conversion, so significantly better. And as I'm sure many of you will know, it's very similar to the cash position that we reported in June which was $227.6 million and 99% conversion. So really adjusting for, I guess, an artificial item, it's actually very comparable to full year. Financial debt for the period was $285.6 million. And if you dig into the details of that in the financials, you'll see that there's a net increase of $25.2 million. We had a net increase in equipment finance during the period of $5.9 million, a net increase in bank debt of $13.8 million. The biggest driver of that being the funding of the Wartsila settlement and also some insurance premium funding as well. So all of those factors combined to give us a net debt position of $158.7 million at December with gearing of 25.7%, from 13.8% at the full year. Now if you adjust that for the late receipts that I just mentioned and also the Wartsila settlement, our net debt would have been $102.1 million and gearing 16.6%. So we feel that, that's really a far more accurate representation of what cash and debt would have looked like in the period, for those one-off items. During the period, we had a net increase in plant and equipment of $29 million and we undertook $90 million of CapEx over the 6 months, which, as you all know, is pretty consistent with what we normally do year-on-year. Capital increased by approximately $60 million over the period with a number of movements that are really just business as usual type items. Receivables were higher than at June due to the late cash receipts that I just mentioned. We also had some $39 million of advanced payments on our projects. And as I think many of you will have often heard me say, we always want to be building our clients' projects with their money, not ours. So that's a positive thing in our book. So let's just say, nothing particularly unusual in any of those items. They're just big movements, which reflect the size of the contracts that we have underway. Our listed investments increased in the period due to the effect of the Spartan Resources revaluation, that was the single biggest driver of that. And in relation to our deferred tax liabilities, that increased by $16.2 million with the main driver being the closeout of the Wartsila litigation. We also had during the period some benefit from the taxable full expensing write-off of about $11 million. That also reflected in our [ DTL ] balance. So all of those movements left us with net assets at the end of December of $617.4 million. I'll just touch briefly on cash flow as I've already hit the highlights but net cash flow from operations was $52.3 million. And as I mentioned, CapEx of $90.4 million, of that $90.4 million, growth CapEx was $21 million, and that's CapEx that we undertake to support new projects or extensions on existing projects, sustaining CapEx was $36.6 million and that's really where we substitute our own fleet for fleet that we've rented from a third party or it's a replacement of end of life. So effectively, what we're doing with sustaining CapEx is, we're improving the margin that we're achieving. And then our maintenance CapEx was $32.8 million. So that's really consistent with our sort of long-term averages that we generally have. We had new borrowings during the period of $62.1 million. $42 million of that was to fund the CapEx I've just discussed and then the balance was to fund the Wartsila settlement. And finally, the other big item in the cash flow during the period was the payment of the final dividend for FY '23, which was the $0.08 per share fully franked and that was $36.1 million. As I mentioned, closing cash was $176.7 million, with cash conversion of 63.4%. When you adjust that for the late receipts, $212.8 million and 83.4% conversion, so much more representative picture. So that's a synopsis of the financials. I'll hand back to Jules and of course, I'll be happy to take any questions at the end.

Thanks, Richard. If we go to the next slide, which is the segment overview. As you can see from this slide, it just continues to demonstrate the diversity of our offering. And obviously, the increases across Civil which were anticipated, Mining and MET, albeit a small increase, just demonstrate the strength of our division and our service offering. So on to Civil, obviously, good news that despite any inclement weather that every time a cyclone was on the news, I'm sure many people were in panic mode given the result we had in the first half of last year. And so the fact that we had to actually put a slide in this pack, we're pleased to obviously advise that we've had no major impact. But obviously, it has been wet in certain areas of our projects but it's not impacted the productivity in large on our projects across the Urban subdivision or any of our major infrastructure projects as well. So strong activity across both WA and Queensland. And obviously, that's reflected in an improvement in margin. And then we probably expect to see that continue to improve as we go towards FY '25, as we've previously advised. Forward outlook looks very good. Lots of iron ore-related expansions, both in major projects and also sustaining capital projects that were involved in pricing at the moment. As Richard said as well, we're experiencing less delays than we've seen sort of 12 months ago. There are certain impacts across parts of that division, which we'll talk about in RCR MET. But generally, in the Civil business, we're seeing things come our way and sort of tend to go to delivery on time, which is a good thing. Importantly, the pipeline is continuing to build. The visibility is continuing to build. And if you look at it on a year-on-year basis, the Civil division was quite subdued in FY '23 due partly to our discipline in pricing and our focus on making sure that we're improving returns and making sure that we can execute correctly on site, obviously, when we've had a challenging labor market. The other pleasing thing during the period was -- actually post the period, was the award of the preferred proponent status on the Reid Highway Interchanges project, public infrastructure project in Perth. There are a number of others that we're involved in, in terms of [ aligned ] style consortiums that are essentially in the sort of pre estimating phase but lots of activity. So lots of things to look forward to in terms of our Civil business. Current order book, pretty strong at $0.7 billion, $700 million and $200 million in active tenders that we're working on at the moment. If we go to, on the Mining business, strong performance from mining, strong revenue and EBIT growth due to the high levels of activity and again, minimal impact from weather. Margin, a little down from second half of last financial year but we did flag that we'd see it returning to sort of more normal levels of 9%. Again, the mix of projects within that margin, some of them where we use a lot of client equipment, you expect a slightly lower margin. So I think at 9%, that's a reasonable reflection of where the margin is at the moment. But again, we would look to improve that as we go into the second half and into FY '25 and we think there's upside there in terms of margins in that business. Again, if we look at our outlook, '24 is fully secured and the majority of '25 is also fully secured. So a very good position to be in, in terms of outlook of our Mining business. We're looking at opportunities into tail end of '25 and into '26. Most of those are coming out of the gold, met coal and iron ore sector, some of which will require capital, some of which won't, obviously discipline around capital deployment in coal has been generally, we only put certain items in, use a lot of hard equipment plus client supplied items and we'll continue to maintain that discipline going forward. In terms of any impacts from lithium-related clients in the Mining business, we -- our drill and blast division has been operating at Greenbushes mine since 2010, minimal impact in terms of that, certainly immaterial in terms of our business, in terms of their uptick in growth from where we are currently. And in terms of our Mt Cattlin project, that was only in sort of phase of ramping up but we don't expect there to be a future material impact again in terms of the division's earnings. Strong order book, $3.4 billion and active tenders at the moment of about $1.9 billion. So if we go on to MET. Very pleasingly, we've seen an improvement in margins, obviously, at the full year, pretty disappointing results. We've had some issues that we've resolved, made some major changes in terms of management and structure and that's starting to deliver well. Primero, in particular, had a very strong performance at 6.4%. DIAB also performed strongly. So if you look at Primero's performance on pcp or really even in the second half of last year, it's a very strong improvement into that business. And again, as MET as a whole, we've previously said it should sort of sit between 7% and 8%, is our long-term margin. And we're working very hard to get it back to those levels at the moment. RCR is slightly below plan due to delayed awards in some of their projects division. A lot of their projects that they do, the clients are sole-sourced or there are also equipment feeder projects. So depending on how others are performing, sometimes their product deliveries get slowed down. We do expect that to improve in the second half and certainly into FY '25. The other thing we've done there is, we've had increases in overheads to support the expansion of the product services business where we manufacture, supply and maintain not only our apron, feeders and our products but also third-party products. That business is an excellent part of the RCR business and strong margins and we expect to increase the -- that business strongly as we go forward. So part of that increase in overhead is obviously to drive the growth in the product support business but it's had a bit of an impact on our overall margin we're reporting in the first half. If we look ahead, again, very buoyant iron ore, gold, particularly a big driver, of course, is in the Primero business with multiyear visibility is the Fimiston contract which has sort of replaced the work that we're doing in Covalent over the last couple of years as well. So very strong visible pipeline of opportunities coming at us. Current order book of $1.3 billion and active tenders of $0.5 billion and a building pipeline ahead of us on that. Again, on the lithium side of things, no material impact. We're largely working in the construction sense for Pilbara Minerals and we're doing a maintenance contract work for Tianqi. And again, none of that is at risk in terms of any slowdown or changes in terms of our delivery profile. So pretty positive all-around outlook for us there. I'll quickly cover a couple of points on the ESG side of things. Obviously, we continue to focus on reducing our carbon footprint through various initiatives that are listed on this slide. It's pretty similar to what we said at the AGM, so I won't go into too much detail on that. But on our safety performance, we've had a pretty strong performance in the year and continued to reduce our TRIFR, is now down to 4.56, which is the best it's been for many years. So it's very encouraging. We continue to focus on critical risk management programs across the group to continue to drive those recordable incidents down. Workforce total is a little bit less than last year but as we see some of these projects commence towards the second half of this year and into FY '25, we'd start to see our workforce build again with that growth that we're expecting. So if we go to our outlook slide, very positive. Our pipeline moves around a bit but the pipeline number is really very near visibility. It's projects that could be in tender, be awarded and commence construction within a 12-month period. So it's a very near-term pipeline. I did note with interest the [indiscernible] pipeline, a 7-year pipeline in construction and the sector is about $1.7 trillion. So clearly, we've got a very focused pipeline of activities. And of that $15.6 billion, we have current tenders at $2.6 billion, as I said previously and most importantly, about $4 billion of that is for FY '25 and beyond. So we've got $1.5 billion to deliver in this half to hit our target of revenue in excess of $2.9 billion. And we're obviously very comfortable with that position as we have reconfirmed our guidance. So just to close on that, we have reconfirmed our guidance at the upper end of our $175 million - $185 million original target with expectations, obviously, firming at the upper end of that range and cash and gearings consistent with long-term averages. So I think that's about the summary. With that, we're happy to go to questions.

[Operator Instructions] Your first question comes from William Park with Citi.

Jules and Richard, could I perhaps start with the guidance. Just looking at the bottom end of your revenue guidance of $2.9 billion and just applying the margin that you have achieved in the first half, that sort of implies EBITDA to come -- basically coming above the guidance range that you've reiterated today. And clearly, your comments around all 3 segments suggest that there's some margin improvement sequentially that could potentially come through. So just wanted to understand, is this the case of you guys being sort of somewhat conservative? Or are there any sort of headwinds that you see that could potentially be a risk, I guess to margin and potential upside to the guidance range?

Look, I think it's conservatism clearly because we did have significant impact in weather last year. We've had weather events, the cyclones keep building off the Queensland Coast and obviously, it's still relatively early in the period, I suppose, running in February. So I think that probably answers your question.

And just on the cash conversion side, I appreciate that it's -- Richard's comments around what drove that cash conversion down this half. But just in terms of your conversations with those customers, who have paid late, like after 31st of December, do you think this is going to be sort of an ongoing issue going forward? In other words, do you expect the cash conversion to be skewed to more to second half going forward?

Look, I don't think so. It was unusual for that particular client to do it. So it was a bit of a surprise to us, I suppose, in terms of that. So we wouldn't expect it on an ongoing basis. That's just...

That client never had never done that.

Never done it previously but it's a big client. So obviously you can see the amount of cash into that particular client. So if you get a couple of others add on to that then -- but as Richard said previously, at 99% cash conversion at the full year, versus where we are. I did note [indiscernible] result yesterday, where again, where they underlined cash conversion was 87%. So I think we've never done that in the past. And I would expect it to unwind and improve in the second half and we don't expect the clients to continue to do that on ongoing basis.

Yes. That makes sense. And just one last one from me. Pipeline in comparison to, I guess, what you have reiterated back at the AGM. [indiscernible] have gone down from $17 billion to $15.6 billion. Is this the case of projects being awarded? You talked about there's delays in project awards. The risk around that is easing. Is it the case of that plus the fact that you guys are taking a more disciplined approach to the pipeline? Or -- just wanted to understand the delta there, please?

Yes, pretty much. I mean, you need to -- you review the prospects and obviously, things you're actually bidding, you've got absolute visibility over, other than what timing might happen on the ground. But the pipeline is essentially the same. If things -- some things may come out of it in terms of they might slip beyond the 12-month win and deliver style profile, if you think of a couple of things in lithium, for example, I mean, Piedmont, we're a preferred partner there and talking to those guys. Now that might be deferred for a period of time. So we take things out that are less certain within that limited delivery pipeline. So our pipeline isn't 10 year of a step. Our pipeline is a very defined pipeline on prospects that are clearly visible.

Your next question comes from Evan Karatzas with UBS.

Just focusing on that $4 billion of work secured for FY '25 and beyond. Is there any additional info you can provide just on, I guess, what's secured specifically for FY '25 of that $4 billion, even if it's, I guess, a rough guide?

Yes, will spill over too. So we're well on track in terms of any FY '25 assumptions in terms of what that delivery profile looks like.

Maybe just a quick follow-up. Can you -- relative to the -- I think you last disclosed it was $2.5 billion. Is it similar or above that, like any additional info there?

Similar to that, Evan.

Okay. Yes. That's fine. And then just going back to that tender pipeline, the $15.6 billion. I'm just trying to get a feel for, I guess, the type of works you're really expecting to drop these next 6 -- or next sorry, next 12 months that really helped to underpin the positive tone or outlook you're speaking to for FY '25. Maybe by sector, if you can just always sort of know what to focus on or not to focus on in terms of contract awards for the next, let's say, 6 to 12 months?

Look, there's a lot happening, Evan, across. I mean it could be mining in gold, mining in iron ore, mining in coal. We don't need any of that in terms of where we're looking at our current assumptions for FY '25, for example, in mining but there is quite a lot of activity there. The Civil projects, a lot of stuff that we're doing at the moment is small and sustaining capital projects but offer better returns. But then there's large infrastructure projects coming as well. So we're preferred proponent on Reid, for example and most of that won't contribute until '25,'26 anyway. It's got a design phase and then it goes into construction. So that, that -- and then you've got RCR working on sole-sourced and Primero working on sole-sourced opportunities in iron ore, major projects that we're not at liberty to disclose. So it's a real mixed bag across all of our divisions.

Which is a really important thing because, again, we keep harping on about the importance of the diversification of the business. And that's -- that really plays out in the tender pipeline where we've got a variety of smaller projects, as Jules said, the sort of $30 million to $50 million projects that will deliver a very solid margin. And then there are some very large projects in there as well, large mining opportunities. So it really is quite a mixed bag. And it's -- as you would all understand, a very diversified portfolio of opportunities that we've got, which is exactly where we want to be.

Your next question comes from Jakob Cakarnis with Jarden.

Just 2 from me, please. Just following on from the earlier questions about FY '25. Is there any cost that's going to build ahead of those revenues that you're expecting for FY '25 in the second half of '24, so the preparation works that you're undertaking that we may need to consider when we look at the margin mix heading into the second half of '24, please?

No. No, I mean, as I said earlier on the RCR slide, some of the overhead that's gone into there is really to drive the product support side of that business, which is a really important margin generating part of that business. So that's really where we're focused on it. It's a bit of a impact in the first half but we don't expect that to continue to build anywhere else.

Okay. And then just sticking on that, Jules, please, the net margin ambition that you spoke to of 7% to 8% over the long run, what do you need to see to pull into place for that to happen? Looks as though that gets us back to kind of FY 2021 sort of levels. What needs to happen to get better surety that, that's a sustainable margin base for us all to focus on for that division, please?

Well, I think DAIB and RCR generally, given the types of businesses and smaller projects generally generate a better margin, the product sales, product support business, which we're focusing on, we're a leader in certain products. We've got a new sealed pan feeder, which is the only one in existence in the world, which we'll start to market and sell very soon to our iron ore customers. So there's various parts that will drive margin expansion. But the Primero side of the business has always been a -- with the exception of the sort of build and operates, we do a lower margin, 5% to 6% and then you'd expect higher margin contributions from the other 2 businesses, giving you that kind of blended margins. So if the other 2 are double digits and you've got a lower -- that volume generated lower margin out of Primero, then that generally kind of gets you to that target 7%, 8%.

Okay. Sorry, just to sneak one final one for Richard, please. Capital intensity moving forward, obviously, $90-odd million of CapEx in the first half. Do we think about that as a go forward on a half yearly basis from here? You gave a good breakdown of the growth versus sustaining and maintenance CapEx. How do we think about everything heading into '25 also with the position of tendering that you're doing, please?

So certainly, for the remainder of the year, Jakob, we're not anticipating that, that it's going to vary too much from the sorts of leads that we've provided to you previously. So we're looking at $180 million to sort of $200 million of CapEx for the full year in FY '24. Going into FY '25, it will depend upon what new work is secured and starts. Now if we haven't won that mining contract today, then it's unlikely that we're going to be spending CapEx on it next year. So just with the lead times. So I don't anticipate that there will be any significant changes at this point in FY '25 to the sorts of levels of expenditure that we're talking about for FY '24.

Jakob, just to clarify, the margin we talked about on the MET's business, I think we had publicly said that we would expect as a group to improve back to around 6%. So the 7% to 8% is obviously a target margin for that division but we don't expect that to suddenly happen in FY '24.

Next question comes from Nicholas Rawlinson with Jefferies.

Just on MET. Could I ask how much revenue came from Fimiston in the first half? And how much do you expect to do in the second half now that construction is ramping up?

Yes, it was pretty small in the first half, Nick because that's, that was really the commencement of the engineering. So just to give you some sense of it, that job has got something like about over 3 million hours, 3.2 million hours or something is involved in that project. At December, we'd executed less than 100,000 hours. So very, very early stages for us at the moment. Over the course of FY '24, our expectation is that revenue for Fimiston would be in the order of $150 million to $160 million, that sort of size and scale. So it's still very early days.

Okay. That's helpful. And I know Jules mentioned 5% to 6% margin for Primero just before. But is the Fimiston project a bit of an exception there?

Yes. The Fimiston project is a good margin for us. And we've talked to the market about that in quite some detail previously. So it's certainly reporting and delivering margin in line with the sorts of guidance that we've provided in the past about that contract.

Awesome. And just on Civil, you mentioned that you've been pricing some of the iron ore expansion projects but the order book and active tenders is still -- still vary a lot. Could you just give us an idea of the potential size of some of the imminent projects?

Yes. I mean none of the bigger iron ore expansions are happening at the moment. Well, we're starting to bid them now, so they haven't been [indiscernible].

And doing [indiscernible] on those things as well.

Yes. Yes. Just trying to get an understanding, are they like $50 million to $100 million projects? Or are they sort of $100 million to $200 million?

Yes, bigger. But there are a lot of others, obviously, the sustaining CapEx and growth on existing areas around West Angelas and around the other hubs is obviously adding quite a lot of those smaller style contracts, too. So it's a big mix probably between kind of the $50 million to $200 million [ projects ], probably where we're aiming in the short to medium term.

Yes. And some of them are starting to come sort of due to tender in the next 6 months or so, let's say?

Yes.

Yes. That's right. It's still quite early in that cycle, though.

Yes. Okay. Understood. Just a final one for me. Could you just comment on trading conditions in January and Feb in each of your key divisions?

That's been very consistent with the results we've just been talking about for the first half. All are performing according to expectations. And as Jules said, keeping us on track for the guidance that we upgraded in November.

[Operator Instructions] Your next question comes from Matthew Chen with Moelis. Hi Matthew, you're in the call. Your line might be on mute. Looks like Matthew is not there. And our next question is from Roy Harrison with Bank of America.

Maybe just some general comments on labor availability and productivity. I mean I saw your head count dropped by circa 200 over the last half. And how confident are you in recruiting labor should you in some of those bigger tenders that you're looking at in the next kind of 6 months?

Labor has actually stabilized a lot. We're seeing much improved sort of situation in terms of turnover rates across the business. So particularly in mining, drill and blast, most of the areas of our business have seen much less turnover on an annualized basis than we've seen in the last few years. So I think that's a real positive. And obviously, over the period of post-COVID and through the sort of inflation year, we passed those costs through to the clients and that's obviously what we're trying to be disciplined around our big practice, given that labor change. And you're seeing that in the improvement obviously in the margins of our business as well. So we don't really have a concern on the labor side of things. Some of the slowdown on high-profile MET related projects by others, [indiscernible] maybe not pushing on Train 4. A few other things will increase the labor pool, which is a good thing for us but we have no concerns at all. We're well ahead of our white collar labor targets on Fimiston and we're very comfortable about our blue collar targets that we have out there at the moment as well and getting good quality skilled people. So we're pretty comfortable.

Next question is from Matthew Chen with Moelis. I think your line might be on mute. There are no further questions at this time and I hand back to Jules for closing remarks.

Okay. Well, no further questions. Thanks very much, everyone, for listening in and we look forward to seeing most of you soon on our roadshows. Thanks very much.

That does conclude our conference for today. Thank you for participating. You may now disconnect.